Gambling Commission Annual Report and Accounts 2020 to 2021

Annual Report & Accounts 2020-2021

HC 364 Making gambling fairer and safer

Annual Report & Accounts For the period 1 April 2020 to 31 March 2021

Presented to Parliament pursuant to Paragraphs 14 and 16 of Schedule 4 of the Gambling Act 2005 and Section 14(3) and Paragraph 11(4) of Schedule 2A of the National Lottery etc. Act 1993 (as amended by the National Lottery Act 1998 and the National Lottery Act 2006).

Ordered by the House of Commons to be printed on 15 July 2021

Laid before the Scottish Parliament by the Scottish Ministers on 15 July 2021

HC 364

SG/2021/84 © Crown copyright 2021 This publication is licensed under the terms of the Open Government Licence v3.0 except where otherwise stated. To view this licence, visit nationalarchives.gov.uk/doc/open-government-licence/version/3.

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Gambling Commission, Victoria Square House, Victoria Square, Birmingham B2 4BP.

ISBN 978-1-5286-2565-4 CCS0421440008

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4 Contents

Performance report 6 Overview 6 Who we are 6 Foreword 8 Overview of the British gambling sector 10 A year in review 13 Financial review 19 Sustainability report 22 Accountability report 24 Corporate governance report 24 Remuneration and staff report 40 Parliamentary accountability disclosures 51 Parliamentary accountability and audit report 52 Financial statements 56 Appendices 78

Annual Report & Accounts 2020-2021

5 Performance report  Overview  Who we are

Overview

Who we are The Gambling Commission exists to make gambling fairer and safer.

We do that by licensing and regulating in the public interest and providing advice and guidance. We want a fair and safe gambling market where all consumers and the interests of the wider public are protected. We are an independent non-departmental public body sponsored by the Department for Digital, Culture, Media and Sport (DCMS) and license operators and individuals in Britain that provide arcades, gaming machines, betting, lotteries, bingo, remote gambling (online, telephone), casinos and gambling software. We are also responsible for awarding the licence and regulating the operator of the National Lottery.

6 Performance report

There are two main pieces of legislation that underpin our work:

 the Gambling Act 2005 (as amended) which sets the framework for the regulation of gambling in Britain

 the National Lottery etc. Act 1993 which sets out the framework within which we regulate the National Lottery.

We have 340 employees, most of whom are normally based at our Birmingham office. There are also around 20 people based in London working on the 4th National Lottery Licence Competition.

Licensing objectives We regulate in the public interest, as guided by our statutory duties, to:

 prevent gambling from being a source of crime or disorder, being associated with crime or disorder, or being used to support crime

 ensure that gambling is conducted in a fair and open way

 protect children and other vulnerable persons from being harmed or exploited by gambling.

In respect of the National Lottery, our objectives are to ensure that:

 every lottery that forms part of the National Lottery is run with all due propriety

 the interests of every participant in the National Lottery are protected

 subject to the above two duties, to secure that the net proceeds of the National Lottery are as great as possible.

7 Performance report  Overview  Foreword

Foreword We present our latest Annual Report and Accounts following what has been a hugely testing and difficult year for everyone across the world – caused by the devasting effects of the global Covid-19 pandemic. The pandemic has had a bearing on all corners of daily Ultimately, it will build on the success of our previous life and the economy, whilst also widely impacting on strategy, with the gambling industry now in a different the gambling industry, its people and its customers, place in terms of technology, innovation and the daily whether they be on the high street or online. operational changes which will be brought by Covid-19.

We identified in the very early stages of the pandemic the The launch of our new Corporate Strategy also comes significant impacts on our regulatory approach and took at a time where we enter the third and final year of the action to devise a new model and ways of working to National Strategy to Reduce Gambling Harms. The protect consumers. In May 2020, and whilst recognising Strategy has done so much to promote a long-term, the difficulties operators have had to face, this included health-led approach to dealing with gambling harms instructing tighter measures to protect consumers such and we have seen widespread support from our public as banning reverse withdrawals and requesting improved health and statutory partners across England, Scotland affordability checks with more people being based at and Wales. home due to lockdown. Now into the last 12 months, the Strategy’s steering The pandemic, which included the closure of land-based and implementation groups will be vital in delivering and operations due to lockdown, has not affected our tough driving the priorities through the Strategy’s action map – enforcement regime which aside from licence suspensions allowing us to evaluate its success and importantly, the and revocations, saw over £30 million issued in fines next steps for the years ahead in terms of research, or regulatory settlements in the past 12 months. education and treatment.

Building on the consumer protections we have Turning to the wider external environment, in November introduced, and our rule changes which will vastly improve we published our ﬁrst ever National Strategic Assessment the safety and design of online casino games and clean which assessed the issues and risks gambling presents up the malpractice of so-called VIP schemes, we also to consumers and the public, alongside our priorities launched our new three-year Corporate Strategy in April to address those risks and where progress has already alongside our annual business plan. been made.

The Strategy, which will take us through to 2024, Shortly after the launch of that document, December is based on ﬁve refreshed priority areas and will give saw the start of the Government’s Review of the 2005 improvements around: Gambling Act. Given the Review is considering our own

 Protecting children and vulnerable people powers and resources, as the statutory advisor to the  Ensuring a fairer market Secretary of State, we are contributing our advice and  Keeping crime out of gambling expertise to the Review which we hope will allow us to  Optimising returns to good causes from the National build on our work to make gambling safer. Lottery and;

 Improving how we regulate.

8 We are keen to see the outcomes the Review will bring We have continued to strongly regulate the National for the industry and consumers, alongside the Fees Lottery which has had another successful year despite the Review, allowing us to be even more effective in regulating challenges of the pandemic – whilst ensuring the operator what is a fast-paced, constantly evolving sector. protects players and maximises returns to good causes, especially after such a tough 12 months. A further £1.83 We also responded last summer to three key reports billion going to good causes through the National Lottery into gambling regulation, including from MPs and the over the past year is another excellent milestone and the House of Lords. We are considering the wider points financial support given to the arts, sports, heritage and raised and also taking a variety of actions to address charities was vital. the recommendations made within those reports. The competition for the fourth National Lottery licence The ever-changing industry was also reflected in our is now successfully underway and we plan to announce decision this year to introduce another advisory panel – the winner within the current financial year following the this time so we can officially hear the independent voices fair and open contest we are currently overseeing. This of those with lived experience of gambling harms. The follows a delay to the launch of the competition by three new Lived Experience Advisory Panel (LEAP) is already months which was due to the unique circumstances helping to inform our decision making as part of a wide caused by the Covid-19 pandemic. range of evidence we must consider and sits closely alongside our work with the Digital Advisory Panel (DAP) In closing, we would like to say thank you to everyone and the Advisory Board for Safer Gambling (ABSG). across the Commission for their huge amount of hard All three chairs from these advisory bodies are now work, commitment and professionalism over the past also attending our Board meetings on a regular basis, year. We would also like to thank former chief executive reflecting the importance of their views and evidence. Neil McArthur, who left earlier this year, for his contribution to the Commission over many years. Staying on collaboration with our stakeholders, despite the impacts of Covid-19, we worked hard to maintain our We have regulated through difficult and unprecedented stakeholder and partner engagement over the past year. circumstances but are in a good position for the year This included a briefing with industry CEOs and a ahead as lockdown restrictions begin to ease for the separate session with the chairs of a variety of gambling whole of the country. operators, which gave us the opportunity to discuss key regulation and consumer protection issues. We value those relationships greatly and hope to continue to build on those, continuing to work alongside our sponsored department, DCMS.

William Moyes Sarah Gardner Sally Jones Chairman Deputy Chief Executive Chief Operating Officer (Joint Acting Chief Executive) (Joint Acting Chief Executive)

9 Performance report  Overview  Overview of the British gambling sector

Overview of the British gambling sector The following pages cover key statistics relating to the gambling industry in Great Britain during 2020-21.

Due to the Covid-19 pandemic, we have been monitoring We have continued to stress the need for extra operator how the continued measures and changing lockdown vigilance and they still need to be mindful that: restrictions across Great Britain have impacted gambling  People will still be spending more time at home behaviour – especially the ways in which people are and online, and many are likely to be feeling more gambling. Those specific changes and risks, along with isolated and vulnerable as a result of the length of the pandemic period, the restrictions that are still in our priority actions, were covered in our first National place and further uncertainty about their personal or Strategic Assessment which was published in November financial circumstances. 2020.  Some consumers, such as highly engaged gamblers We have monitored gambling behaviour during the who play a range of products, are likely to spend more time and money gambling, and; pandemic by gathering, analysing and publishing data from operators, as well as conducting consumer  There are consumers who may be gambling for the first time. research. Released on a monthly basis, the publications With the level of restrictions under constant review, during can be found on our website. the coming months and over the next financial year we will continue to urge operators to be mindful about the potential of some consumers to increase their spend on some of the more intensive products whilst at the same time still engaging in real event betting activity such as sports. The industry

 Total GGY of British gambling industry: £14.2 billion1 – down 0.6% when compared to April 2018-March 2019

 Total GGY of British remote/online sector up 8.1%1 when compared to April 2018-March 2019

Graph A) Gross gambling yield (£m)1 vs participation2*

All gambling 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20

In-person gambling 4,883 4,646 4,772 4,964 5,220 5,340 5,493 5,429 5,584 5,554 5,438 4,427

Lotteries (in person 2,665 2,838 3,010 3,353 3,553 3,394 3,582 3,797 3,421 3,510 3,620 4,012 and online)

Online gambling 1,405 1,668 2,036 2,290 2,727 2,979 3,548 4,231 4,775 5,347 5,267 5,681 (excluding lotteries)

Past 4 week 57% 55% 53% 45% 48% 45% 46% 47% 42% participation rate

Past 4 week online 14% 15% 16% 15% 17% 18% 19% 21% 24% participation rate

10 In Great Britain, there are:  156 casinos1  1,615 licensed arcades1

 646 bingo premises1  191,826 gaming machines1

 7,681 betting shops1  696 active remote licensees Consumers

 Approximately 22.1 million2 adults gambled in 2020 – down 2.6 million since 2019

 Approximately 12.1 million2 adults gambled online in 2020 – up 1.3 million since 2019

 50%3 of online gamblers use their mobile to gamble – stable since 2019

 29% of people in Great Britain agree that gambling is conducted fairly – but still a decrease from 2016. Our consumer and industry engagement work therefore continues to be of vital importance. Consumer trust in gambling Graph B) Respondents agreeing that gambling in this country is conducted fairly and can be trusted2

2016 2017 2018 2019 2020

All respondents 34% 33% 30% 29% 29%

Gambled in past 12 months 38% 38% 34% 32% 32%

Not gambled in past 12 months 29% 27% 25% 25% 25%

Move to mobile Graph C) Devices used for online gambling in the past four weeks3

2016 2017 2018 2019 2020

Laptop/PC/Tablet 92% 86% 77% 71% 71%

Mobile 29% 39% 44% 50% 50%

Sources: 1. Industry statistics 2019-2020. Published in November 2020 2. Quarterly Telephone Survey — Year to Dec 2020. 3. Quarterly Online Tracker – Year to Dec 2020 4. Health Survey for England 2018

Increases and decreases shown from Sources 1 and 3 are based on percentage point changes.

11 Performance report  Overview  Overview of the British gambling sector

Overview of the British gambling sector continued

 2.5 million bet on football2 – down 0.5 million since 2019

 20% of online gamblers bet in play3 – down 1% since 2019

 6% of gamblers self excluded3 – up 1% since 2019

 Approximately 245,000 adults in England are problem gamblers4

 1.2 million adults in England are low risk gamblers4

 380,000 adults in England are classed as at moderate risk4

National Lottery

 £1.83 billion raised for good causes during 2020-2021

 Over £43 billion raised for good causes since 1994

 Approximately 14 million reported buying a National Lottery ticket in the past four weeks2

Increases and decreases shown from Sources 1 and 3 are based on percentage point changes.

12 A year in review– delivery of our corporate business plan

In this section we reflect on the work we have done in the final year of our three-year Corporate Strategy to ensure strong regulation while protecting consumers from gambling harm. As set out in our corporate business plan, our five key focus areas are:

 Protect the interests of consumers

 Raise standards in the gambling market

 Prevent harm to consumers and the public

 Improve the way we regulate

 Optimise returns to good causes from lotteries. Summary of achievements – 2020-21 corporate business plan milestones

 33 milestones were due

 21 milestones were achieved

 10 were rescheduled and will be delivered during 2021-22

 2 milestones were superseded.

The following gives details of the Commission’s milestones which were superceded or replanned during 2020-21: Milestones superseded:  Complete a review of online gambling protections, including controls on stakes and prizes

 Enhance the functionality of our risk assessment tool Milestones replanned:  Advise the Secretary of State on the Government’s review of the Gambling Act 2005

 Publish an evaluation of our actions to reduce the risk of harm to children and young people

 Review our approach to measuring participation and prevalence and publish conclusions

 Deliver industry events and a programme of initiatives to raise standards

 Publish clearer documentation about our Corporate Governance process

 Improve the licence application process

 Implement changes to our Governance framework and practices

 Implement agreed proposals to improve our approach to regulatory data

 Provide centralised support for impact evaluation

 Enhance staff engagement including a Commission-wide staff conference.

13 Performance report  Overview  A year in review A year in review – delivery of our corporate business plan continued

Protect the interests of consumers

Consumers are at the heart of our regulatory approach. As gambling behaviour evolves, we work hard to stay on top of emerging trends, including those caused by the Covid-19 pandemic, to ensure our work is focused in the right areas.

Over the past 12 months we have continued to remind commercial operators of their social and consumer responsibilities and taken decisions, supported by research and our relations with external stakeholders, to take appropriate regulatory actions.

Our key activities in this area were:

 Along with strict guidance, we  Through our research and insights  Following a successful initiative with wrote to online operators upon we have constantly analysed data, Twitter in 2019-20, we partnered the outbreak of the Covid-19 markets, products and trends. with Facebook to publish a guide crisis reminding them of their These insights allow us to look at for consumers on how to limit their responsibilities to their customers the risks and opportunities in the exposure to gambling content on with millions of people having to industry which inform our work. the social networking platform. observe social distancing rules. This This year has included the growth  We have supported the Committee included us issuing new guidance in online gambling and consumers’ of Advertising Practice’s (CAP) recent after seeing evidence that some move to mobile. proposals to tighten the rules people may have been at greater  We continued to see rapid progress around the content and targeting risk of harm during lockdown. through our Advertising Technology of gambling adverts, in particular, Included in that guidance were the challenge to the industry, which to further limit the appeal of need for affordability checks, the aims to reduce the amount of online gambling ads to under-18s prevention of reverse withdrawals advertising seen by children, young and other vulnerable people. and restrictions on bonus offers. people and vulnerable adults. This  We welcomed the commencement  Our Consumer Contact Centre led to the production of a common of the Government’s Gambling Act continues to be the main point of list of negative search terms, a 25+ Review and a separate consultation contact for the public and players. age approach to prospecting ad on fees. We have contributed to the During the 2020-21 ﬁnancial year, campaigns on social media, and evidence gathering by DCMS. the team received 9,304 complaints better use of customer data to from consumers about operators ensure paid-for ads are targeted which helped support and inform away from vulnerable groups our regulatory approach. across social media platforms.

 We commissioned a piece of  We continued the development consumer research to understand of the Single Customer View project, how we can best inform consumer which aims to reduce consumer decision-making and assist harm harms by providing a holistic picture prevention. of a customer’s online gambling activity, including continued engagement with key stakeholders such as the Information Commissioners Office (ICO).

14 Prevent harm to consumers and the public

Minimising and preventing gambling harm is a key focus for the Commission and over the past 12 months, despite the Covid-19 pandemic, we continued to use our full range of powers, working closely alongside our partners, to enhance protections for the public and players and introduce new ideas and ways of working.

Now in its third year, the National Strategy to Reduce Gambling Harms continues to offer the means for collaboration by the Commission and partners to reduce gambling harms. The Commission’s actions map tracks the signiﬁcant range of positive actions across the nations and regions to support this collaboration.

Through our regulatory powers, we have also continued to take proactive action against online and land-based operators who have not done enough to protect their customers from gambling harm.

Our highlights in this area included:

 In April 2020 we introduced a high- on these ﬁndings and published the on children, young people and proﬁle ban on the use of credit cards information for stakeholders to inform vulnerable adults. for gambling and continued to watch them of developing consumer trends.  We have reviewed and approved closely for any unintended  The establishment of a new Lived regulatory settlements with a consequences for consumers. Experience Advisory Panel (LEAP) cumulative value of millions of  The introduction in September 2020 in February 2021 which provides pounds for activities to be applied of strict new guidance for operators independent advice based on its for socially responsible purposes. to clean up the malpractice of so- members’ personal experiences of  Supporting the delivery of called VIP schemes. gambling harms – helping to inform independent research commissioned our decision making.  We announced a package of strict by GambleAware, which has included measures in February 2021 around  In November 2020, we published the the publication of reports into the online slots games which included latest actions map and update for impact of the behavioural change the introduction of limits on spin the continued delivery of the National principle of anchoring, guidance for speeds and the permanent ban on Strategy to Reduce Gambling designing safer gambling messaging, features such as autoplay or those Harms. This included how we and interim results from the Patterns which celebrate losses as wins. The continued to contribute, alongside of Play project. permanent prohibition of reverse our public health and statutory  Following our implementation of the withdrawals was also announced partners, to steering groups and requirement for online operators to alongside these measures. implementation groups across participate in Gamstop, the national England, Scotland and Wales.  We closely monitored online and, self-exclusion system, we continue where appropriate land-based  We continued to work closely with to monitor compliance closely. gambling patterns to understand a range stakeholders, particularly  Through a consultation with the how the Covid-19 pandemic CAP and the Advertising Standards industry and other stakeholders changed the risks experienced by Authority (ASA), to respond to the we reviewed our approach to consumers through the collection recommendations outlined in measuring gambling participation of additional industry data and GambleAware’s research into and prevalence. consumer research. We acted the effects of gambling advertising

15 Performance report  Overview  A year in review A year in review – delivery of our corporate business plan continued

Raise standards in the gambling market

To protect consumers, the Commission’s role is to ensure standards are constantly being raised across the gambling industry. We do this through a variety of ways – via our day-to-day licensing work, targeted compliance activity, and using our enforcement powers where we see standards are not being met.

During the past 12 months we carried out our compliance and enforcement activity through a number of challenges brought by the Covid-19 pandemic – which saw large parts of the gambling sector, including land-based businesses, closed for the majority of the year.

We continuously engaged with operators to understand the impacts of Covid-19, which included understanding which products had seen an increase in play, splits between new and existing players and increase in spend and customer interactions. This was backed up by a programme of targeted assessment work to collate evidence.

Our highlights in this area included:

 We continued with our programme  In 2020-21, our intelligence team, (UKAS) and all test houses to of compliance activity as much as who provide a confidential ear to the implement changes aimed at raising possible during 2020-21. As part of industry and the public, as well as standards in the industry. our refined focus and process, we being our main gateway to partner  We have continued to work to shut conducted 25 full assessments of agencies such as the National Crime down illegal gambling, working closely online operators and five targeted Agency, international law enforcement with law enforcement agencies, the assessments of land-based organisations, and sports governing UK Cyber Centre and consumers operators. bodies, generated 3,836 intelligence to gather intelligence and take action reports, relating to a number of issues  Additionally, we carried out 83 against black market gambling. including social media lotteries, website reviews and 262 security unlicensed remote operators and  We have assessed the ongoing audits. 29 personal licence reviews money laundering. 29 Incident suitability of our licensees by using were commenced and 57 were Referral Forms (IRFs) were submitted a variety of tools, such as regulatory finalised, including from the previous by the unit to Incident Management data and interaction with financial year. Group (IMG) for consideration. stakeholders. In the past year we  We also continued with our tough have processed 170 operator licence  Aside from a variety of other enforcement activity against gambling applications, with 545 individuals intelligence which was processed, operators and personal licence applying for a personal licence. our Sports Betting Intelligence Unit holders who failed to meet our received over 700 specific reports  We published our third annual standards. We have continued to which included issues such as Compliance and Enforcement Report hold operators to account for failings suspicious betting activity, sports which outlined case work during around anti-money laundering, social rules breaches, misuse of inside 2019-20 alongside recommendations responsibility controls and customer information, Gambling Act offences or and case studies for operators. interaction issues. Our casework led other criminality. Football and tennis to the suspension of five operators  We continued to ensure Boards continue to be the source for the and the revocation of one operator focused on their responsibilities to majority of these reports, despite and nine personal management be tested via corporate evaluations disruption to the calendar due to licence holders. A total of £32.1m and assurance statements. Covid-19. was paid by 15 operators as a result  We supported the UK Government in of fines or regulatory settlements. This  Following the test house framework developing the role of the Regulatory covered £13.2m in fines and £18.9m consultation, we worked with the Supervisor for Money Laundering. in regulatory settlements. United Kingdom Accreditation Service

16 Optimise returns to good causes from lotteries

Lotteries, including the National Lottery, make signiﬁcant contributions to society and generate important funds for good causes – with £43 billion raised by the National Lottery since its launch in 1994. Those good causes include funding sports, arts, heritage and community projects.

The National Lottery has made a difference to the lives of millions and continues its positive impact on society. The Commission’s role is to ensure it is run with propriety whilst protecting the interests of every player, whilst making sure funds are maximised for good causes.

Last year we launched the competition for the next National Lottery licence which will begin in 2023. The preferred bidder will be announced in late 2021.

Our highlights in this area included:

 We worked with the Operator to  Returns to good causes finished  We outlined our conclusions enable the National Lottery to the financial year at £1.83bn. It following a consultation of society continue to run smoothly during has been a strong year, particularly lottery prize limits and transparency the Covid-19 pandemic and given the challenging circumstances measures. resultant lockdowns and monitored this year.  Through a Selection Questionnaire, performance closely to ensure  In July 2020, following a public we officially launched the competition players continued to be protected consultation, we strengthened for the next National Lottery franchise during the rapid and significant several important aspects of our in August 2020. increase in online play. licence conditions and codes of  Following the launch of the Selection  We continued to focus on players’ practice which apply to society Questionnaire, we published the interests more broadly, undertaking lotteries. New requirements and Invitation to Apply to successful a review of our approach to accompanying guidance ensure applicants and are pleased with the Interactive Instant Win Games consumers have information number of entrants. to protect players from harm. available to help them make fully informed decisions about whether  We approved joint marketing to participate in lotteries. At the investment proposals between the same, time limits on the size of Operator and good causes for Lotto, society lotteries were raised in EuroMillions, Set for Life and the line with Government legislation. National Lottery Brand. Performance of existing marketing investment proposals indicate that previous such approvals have delivered for good causes and that these decisions stand to significantly benefit good causes during the 2021/22 financial year.

17 Performance report  Overview  A year in review A year in review – delivery of our corporate business plan continued

Improve the way we regulate

Our risk and evidence-based approach to regulation continues to ensure high standards are maintained by all operators we licence. This approach also plays a role in setting the direction for others in the industry to follow as we work to ensure gambling is safe, fair, free from crime and free from the risks of money laundering.

We continue to monitor and review our performance with the pace of innovation and technology constantly accelerating. Despite the impact of the Covid-19 pandemic, in the past year our administrative and licensing procedures continued to be streamlined and improved to ensure they were more digitally accessible for the industry, licensees, the public and players.

Our highlights in this area included:

 As part of our response to the  The work on our new website has  We worked hard to respond to the Covid-19 pandemic, we collected been a success and has ensured challenges presented by Covid-19 and published regular data about the full compliance with new online on our colleagues and remote trends we were seeing throughout accessibility legislation. The new-look working processes to ensure the year and during the various site was launched in June 2021. there was a minimal impact on lockdowns across the country. This recruitment, training and wellbeing.  We continued to improve and enabled us to respond effectively and consolidate our internal software  We undertook a culture diagnostic provide clear guidance to operators and hardware estate, moving further and have developed a programme as the country transitioned to virtual towards an entirely cloud based that continues to develop us as an and remote working. infrastructure - improving resilience, inclusive and diverse organisation  We welcomed reports into gambling information security and user and a great place to work. regulation by Members of Parliament experience. and the House of Lords, following an  Our project to automate the personal earlier National Audit Office report. management licence application We continue to take forward the process was delayed due to Covid- key recommendations. 19 but will be delivered in Summer 2021. We have continued to see the positive impacts from automation of the personal licence maintenance service with reductions in processing time of 50% or more and are looking to achieve similar outcomes in the next ﬁnancial year.

18 Financial review Commission funding The Commission is an independent public body. We are funded in two ways:

 by application and licence fees set by the Secretary of State, approved by Parliament and paid by the gambling industry. These fees fund all gambling regulation except that for the National Lottery.

 in respect of National Lottery functions, by grant-in-aid from the National Lottery Distribution Fund (this grant-in-aid is not treated as income in accordance with FReM).

Income Our total income from fees and other sources was Total fee income has been analysed by industry sector £18.87m for the year (£19.90m for 2019-20). This ﬁgure in the chart below.

does not include the £19.520m (2019-20: £17.020m) Annual operator fee income by sector 2020-21 of grant-in-aid funding in respect of the National Lottery functions which is transferred directly to reserves. 2021

Our fee income for the year was made up of the following: Arcades 64%

 Operator application fee income was £0.66m Machines 24% (2019-20: £1.02m); Betting 31%  Fees for personal licences £0.58m (2019-20: £0.92m); Bingo 4%  Operator annual licence fees £17.22m (2019-20: Casino 28% £17.71m);

 Miscellaneous income of £0.41m (2019-20: £0.25m). Lotteries 7% This was mainly attributable to contributions to compliance and enforcement costs received from operators.

19 Performance report  Overview  Financial review

Financial review continued Expenditure During the year, total expenditure on operational costs Employee costs for gambling regulation were £15.94 including depreciation was £38.06 million (2019-20: million (2019-20: £14.31 million) and National Lottery £37.45 million), an increase of £0.61 million on the regulation £5.45 million (2019-20: £5.18 million). Of this, prior ﬁnancial year (0.02%). £3.19 million related to the National Lottery 4th licence

Expenditure on gambling regulation totalled £20.47 competition (2019-20: £2.83 million). million (2019-20: £21.20 million) National Lottery For comparative purposes, the table below shows year functions accounted for £17.59 million (2019-20: £16.26 on-year operational expenditure comparison for gambling million). This included £14.83 million on the National and National Lottery regulation expenditure, and the costs Lottery 4th licence competition (2019-20: 13.29 million). of Horserace Betting Levy activity which was funded by

Employee costs for the year were £21.39 million (2019- the Horserace betting levy and ceased in 2018-19. 20: £19.49 million), an increase of £1.90 million.

2016-17 2017-18 2018-19 2019-20 2020-21 £m £m £m £m £m National Lottery regulation 2.67 2.98 2.81 2.97 2.76 National Lottery competition 0.20 0.64 4.08 13.29 14.83 Gambling regulation 18.01 19.53 20.54 21.20 20.47 Horserace Betting Levy activity – 0.04 0.16 – – Total costs of operation 20.88 23.19 27.58 37.45 38.06

Net expenditure for the year During the year, the regulation of gambling under the activity, particularly in relation to technological 2005 Gambling Act, as amended and updated by the developments, is increasing and together with the Gambling (Licensing and Advertising) Act 2014, produced reduction in licence fees that came into effect from 6 April an income and expenditure deficit of £0.809 million. 2017, this resulted in the planned deficit for the year. The deficit for the year was budgeted under the The total income and expenditure deficit arising for the Commission’s medium-term financial plan using reserves year is £19.30 million, including regulating the National created from the fee income collected in prior years Lottery. This deficit is due to the requirement to transfer because of the continuing expansion of the gambling grant-in-aid funding in respect of National Lottery industry, particularly within the remote sector. The regulation direct to reserves and not being included as Commission sought to address this by achieving a deficit income. in 2020-21 through expenditure exceeding licence fee income. Expenditure on the Commission’s regulatory

20 Statement of ﬁnancial position At 31 March 2021 the book value of non-current assets was £5.19 million (2019-20: £6.57 million). Assets less liabilities at 31 March 2021 amounted to £3.95 million (2019-20: £3.97 million). The year-end closing cash balance at 31 March 2021 was £17.56 million (2019-20: £16.61 million). The cash balance reaches its peak between August and November each year, after the largest tranche of annual fees fall due, which are paid in advance by operators. Grant-in-aid to fund National Lottery regulation is drawn down on a monthly basis as required, satisfying the normal conventions applying to Parliamentary control over income and Payment performance. The Commission’s policy is to pay all invoices within 30 days of receipt unless a longer payment period has been agreed or the amount billed is in dispute. In the year to 31 March 2021, 71% (target 95%, 2019-20: 74%) of invoices totalling £15.08 million were paid within 30 days of receipt. Steps will be made to improve performance during 2021/22, by reviewing invoice processing to reduce time taken to resolve queries.

21 Performance report  Overview  Sustainability report

Sustainability report This sustainability report complies with the requirements of the Greening Government Commitments – the UK government’s commitments to delivering sustainable operations and procurement. Corporate Responsibility As part of our commitment to corporate responsibility the Commission seeks to have a positive role in the lives of our employees and our community. We do so by:  Being a responsible employer (see Staff Report).

 Reviewing and minimising our impact on the environment (see Sustainability Report).

 Supporting our local community through our relationship with LoveBrum.

 Ensuring we maintain robust anti-corruption and anti-bribery policies. Greenhouse gas (GHG) emissions These are commonly referred to as carbon accounting or carbon footprinting and are split into three:  Scope 1:  Scope 2:  Scope 3: Direct GHG emissions – these Energy indirect emissions Other indirect GHG emissions occur from sources owned or – as a result of electricity that – all other emissions which occur controlled by the Commission, we consume which is supplied as a consequence of our activity for example, emissions as a by another party, for example, but which are not owned or result of combustion in boilers, electricity supply in buildings. controlled by the Commission, or emissions from ﬂeet vehicles. for example emissions as a result of staff travel on official business.

2020-21 2019-20

Non-financial indicators tonnes CO2e tonnes CO2e Total Gross Emissions for Scopes 1 & 2 (procured electricity, gas and fleet vehicles incl pool cars) 41.53 87.93* Gross emissions attributable to Scope 3 (indirect emissions and official business travel) 5.22 96.00 Related energy consumption thousand kWh thousand kWh Electricity: non-renewable Electricity 151.41 291.83 Gas 33.87 21.94** Financial indicators £'000s £'000s Expenditure on energy 22.72 28.99 Expenditure on official business travel 1.03 293.67 * 2019-20 ﬁgure have been restated to correctly reﬂect the consumption during the period. ** 2020-21 gas consumption is higher compared to prior year, due to issues with old boilers needing to be kept on during Q4, this was resolved in May 2021

Waste minimisation and management Data on waste is collated (in line with Sustainable Operations on the Government Estate (SOGE) targets) for all offices and land owned by the Commission:

 waste to landﬁll (residual office waste).

 waste reused/recycled (paper, aluminium cans & glass).

 waste incinerated.

 hazardous waste.

2020-21 2019-20 Non-financial indicators tonnes tonnes Total waste arising 9.77 22.56  Hazardous waste – –  Non-hazardous waste  Landfill – –  Reused/recycled 2.69 9.14*  Waste composted – –  Incinerated with energy recovery 7.07 13.41*  Incinerated without energy recovery – –

* 2019-20 figure have been restated to correctly reflect the consumption during the period. Use of finite resources This category is broken down into use of water, energy and other finite resources. Water sources are classified by:

 Scope 1:  Scope 2:  Scope 3: Water owned or controlled by the Purchased water, steam or ice. Other indirect water. This would Commission. This would include This would include mains water include embodied water emissions water reserves in lakes, reservoirs supply as well as other deliveries in products and services. and boreholes. of water i.e. for coolers.

2020-21 2019-20 Non-financial indicators m3 m3 Water consumption (office estate), Scope 3  Supplied 1,709.00 2,365.00*  Per FTE 4.84 6.70* Financial indicators £'000s £'000s Water supply costs (office estate) – – Water supply costs (non-office estate) – – * 2019-20 figure have been restated to correctly reflect the water consumption during the period. Sustainable procurement Many of the Commission’s contracts are awarded through pan government frameworks operated by Crown Commercial Services (CCS). This allows us to take advantage of the CCS active sustainable procurement policy to ensure that environmental obligations are properly reflected. CCS has also implemented the Andrew Rhodes DEFRA2 sustainable procurement prioritisation tool to support decision making Interim Chief Executive and, where appropriate, sustainability obligations are included within contracts and Accounting Officer 6 July 2021 let by CCS to ensure that:

 Goods and services are purchased on a whole life costs basis

 Performance can be monitored throughout the life of the contract. The use of small and medium sized enterprises (SMEs) for supply of goods and services across the Commission exceeds the Government’s 25% target. William Moyes During 2020-21, 26% of our procurement expenditure was sourced from SMEs Chairman 6 July 2021 (2019-20: 30%).

23 Accountability report  Corporate governance report  Directors’ report, Board of Commissioners

Accountability report

Directors’ report, Board of Commissioners

William Moyes John Baillie Stephen Cohen Chairman Chair of Audit Chair of National Lottery and Risk Committee Competition Committee

Trevor Pearce CBE QPM Catharine Seddon Carol Brady MBE Chair of National Lottery Senior Independent Director Commissioner Committee, Remuneration Committee and Reset

Terry Babbs Brian Bannister Jo Hill Chair of Finance and Commissioner Commissioner Performance Committee 24 Corporate governance report

William Moyes Chairman Dr William (Bill) Moyes’ career has spanned the public and John’s first term as a Commissioner ends in April 2021, private sectors, including leadership roles at five national but his reappointment for a further 12 months was regulators. Having completed a PhD in theoretical announced in March of this year. chemistry at the University of Edinburgh, Bill entered the Stephen Cohen UK Civil Service Fast Stream in 1974 and spent 20 years Chair of National Lottery Competition Committee in policy-making roles in Whitehall and the Scottish Office. Stephen has over 40 years’ experience in asset Bill is also the Chairman of the General Dental Council, management, in Asia, Europe and the USA. He started his which regulates dental professionals to secure the delivery career with Mercury Asset Management and worked both of high standards of education, training and professional as a portfolio manager and in business development. practice to protect the public. Bill has held positions in Stephen is also on the board of the Health & Care banking – funding the construction of hospitals, a period Professions Council, a healthcare regulator, and is Chair as director general at the British Retail Consortium and of Audit for both the JPMorgan Japan Investment Trust plc executive chair at Monitor, the independent regulator of and the Schroder UK Public Private Trust plc. Stephen brings NHS Foundation Trusts. Previous board appointments a global business perspective, deep experience of finance include the Priory Hospital Group, the Legal Services and financial services regulation, corporate governance, as Board and the Office of Fair Trading. Bill has extensive well as board engagement, activism and fintech. experience of organisational leadership at board and Trevor Pearce CBE QPM senior executive level in the regulation of industries and Chair of National Lottery Committee, professional groups. Bill will step down from his term Remuneration Committee and Reset as Chairman in September 2021. Trevor Pearce has had a 40-year career in law enforcement. John Baillie Starting at Kent County Constabulary, he moved to national Chair of Audit and Risk Committee agencies becoming director general at both the National John is a Chartered Accountant and a former partner Crime Squad and Serious Organised Crime Agency. More of KPMG in Scotland and London. He is a former chair recently, Trevor has focussed on regulatory roles and risk of the Accounts Commission for Scotland, the Scottish management. He is chair of UK Anti-Doping and trustee of local authority watchdog and served two three-year terms. Canterbury Oast Trust, a charity providing residential services He was also a member of the Reporting Panel of the UK to adults with learning difficulties. He is also trustee of Stop Competition and Markets Authority for nine years. John the Traffik, a charity working to prevent human trafficking. was also a visiting professor of accountancy at the Trevor brings experience of running large complex University of Edinburgh and has previously held similar organisations, dealing with international serious and appointments at other Scottish universities. organised crime, anti-money laundering, integrity and anti-corruption. 25 Accountability report  Corporate governance report  Directors’ report, Board of Commissioners

Directors’ report, Board of Commissioners continued Catharine Seddon Terry Babbs Senior Independent Director Chair of Finance and Performance Committee Catharine spent 20 years as a film-maker before taking Terry Babbs has spent his executive career in both up public non executive roles. She started as a graduate the private and public sectors – including with Tesco trainee producer with the BBC and soon specialised in and a number of global supply chain management high-end film documentaries, eventually setting up her organisations. Aside from his role at the Commission, own production company. She became a magistrate in Terry is also the Senior Independent Director at the 2000 and later left television to take up a variety of other General Dental Council, vice chair of the Investment judicial roles, to become a member of the Human Tissue Committee of Oxfam’s Enterprise Development Authority and to sit on the Determinations Panel of the Programme, and a non-executive director of HMRC’s Pensions Regulator. Catharine now sits on the Legal Valuation Office Agency. Services Board, where she chairs its Audit and Risk Brian Bannister Assurance Committee and has recently joined the board Commissioner of the HFEA. She is a founding member of the Health Currently the Global Head of External Communications Service Products Appeal tribunal and is also a trustee for the Boston Consulting Group, Brian Bannister was for special needs charity, CPotential. previously Executive Director for Strategic Insight and Catharine’s first term as a Commissioner ends in April Influence at The Law Society of England and Wales. 2021, but her reappointment for a further 12 months He has also led global communications for KPMG was announced in March of this year. and UK communications at PwC.

Carol Brady MBE Jo Hill Commissioner Commissioner Carol Brady is currently Chair of Birmingham Assay Office Jo Hill is currently Executive Director of Strategy and Risk which provides assaying and hallmarking of precious at The Pensions Regulator where she leads on corporate metals and is also the managing director of a consumer strategy, risk management, data and analysis. She was protection consultancy. Her career has been focused previously Director of Market Intelligence, Data and on consumer protection and her previous roles have Analysis at the Financial Conduct Authority (FCA) and included chairing the claims management regulation held a number of senior roles across the FCA, while also unit at the Ministry of Justice, chairing the Chartered working in the banking and insurance sectors. Jo is also Trading Standards Institute’s Board, acting as a senior a Trustee of the Money and Mental Health Policy Institute. ombudsman at the Legal Ombudsman and as an

independent advisory member at the Commission for Two further Commissioners, Jonathan Scott and Sir Local Administration (Local Government and Social Care Martin Narey left the Commission during the ﬁnancial year. Ombudsman). Carol was awarded an MBE in 2016 in recognition of her services to consumers and better regulation. She is a fellow of the CTSI, an honour bestowed on her in 2009 for her contribution to the profession. She began her career with trading standards and has worked in the former Department for Trade and Industry to set up the Consumer Direct helpline.

26 Register of disclosable interests Fees and charges Board members completed their annual declarations of The Commission aims to ensure that the costs incurred interest and are asked to declare any relevant interests in delivering the organisation’s strategic objectives are in agenda items at the start of each board meeting recovered from the industry through application and and absent themselves from those discussions. No licence fees set by the Secretary of State. We periodically directorships or other signiﬁcant interests were held review our costs to drive efficiency and value for money by board members that may have conﬂicted with as well as review our approach to cost recovery via fees their management responsibilities. to see how it could be made more equitable. As a direct result of this process, the Commission delivered, through Directors’ disclosure the 2017 fees review, a reduction in licence fees from As far as the directors are aware, there is no relevant 2017-18. audit information of which the auditors have not been made aware. All reasonable steps have been taken Current application and licence fees range from £195 to by the directors in order to make themselves aware £494,856 dependent on operator size and licence type. of any relevant audit information and to establish that The Commission’s total income from fees and other the auditors are aware of this information. sources was £18.87 million for the year (2019-20: £19.90

Whistleblowing policy million). Further analysis of fees and charges is provided The Commission has a whistleblowing policy in place in the Performance Analysis section. for the conﬁdential reporting of unlawful conduct or malpractice.

The policy is readily available on the intranet for all employees to refer to, and reminders on the requirements Andrew Rhodes of this policy, together with all aspects of the code of Interim Chief Executive conduct are communicated regularly via internal and Accounting Officer communication methods. 6 July 2021

All new Commission employees are required to conﬁrm in writing that they have read the Code of Conduct, including the whistleblowing policy which is included in our Public Interest Disclosure policy, as part of the William Moyes induction programme. Chairman 6 July 2021

27 Accountability report  Corporate governance report  Statement of the Commission and Accounting Officer’s responsibilities

Statement of the Commission and Accounting Officer’s responsibilities

Under the Act, the Secretary of State for Digital, Culture, Media and Sport has directed the Commission to prepare for each financial year a statement of accounts in the form and on the basis set out in the Accounts Direction. The accounts are prepared on an accrual basis and must give a true and fair view of the state of affairs of the Commission and of its income and expenditure, Statement of Financial Position and cash flows for the financial year.

In preparing the accounts the Commission and The Accounting Officer of DCMS has designated me as Accounting Officer are required to comply with the the Commission’s Interim Chief Executive Officer and as requirements of the Government Financial Reporting Accounting Officer of the Commission. The responsibilities Manual and in particular to: of an Accounting Officer, including responsibility for the propriety and regularity of the public finances for which  observe the Accounts Direction issued by the Secretary of State for Digital, Culture, Media and the Accounting Officer is answerable, for keeping proper Sport, including the relevant accounting and disclosure records and for safeguarding the Commission’s assets, requirements, and apply suitable accounting policies are set out in Managing Public Money published by the on a consistent basis HM Treasury.  make judgments and estimates on a reasonable basis As the Accounting Officer I have taken all the steps that I  state whether applicable accounting standards as set out in the Government Financial Reporting Manual ought to have taken to make myself aware of any relevant have been followed, and disclose and explain any audit information and to establish that the Commission’s material departures in the financial statements auditors are aware of that information. So far as I am  prepare the financial statements on a going concern aware, there is no relevant audit information of which the basis and auditors are unaware.  confirm that the Annual Report and Accounts as a whole is fair, balanced and understandable and take personal responsibility for the Annual Report and Accounts and the judgements required for determining that it is fair, balanced and understandable.

Andrew Rhodes Interim Chief Executive and Accounting Officer 6 July 2021

28 Governance Statement for the year ended 31 March 2021

I became accounting officer on 15 June 2021, taking over from Sarah Gardner who held the position from 15 March following the resignation of former chief executive, Neil McArthur. Since being appointed as accounting officer, a full and comprehensive handover has commenced between Sarah Gardner and myself.

The Gambling Commission Board The Board has complied with government guidance for The Commission monitors its performance using an corporate governance in arm’s length bodies. outcome-based framework built around its statutory

Four new Commissioners were appointed during the year, duties and business plan. Performance against these with two Commissioners leaving during the same period. outcomes is monitored by the board on a regular basis, Two Commissioner’s terms were due to end in April 2021, with updates being provided by the Executive team on but their reappointments were announced by DCMS in the Commission’s performance covering operational March 2021. management and delivery and a range of strategic measures on at least a quarterly basis. New Commissioners go through an extensive programme of induction and training to ensure a solid foundation of The accounting officer has personal responsibility for knowledge about consumer issues in gambling and the stewardship of the organisation’s resources, consistent operating environment and diversity of the sector. We also with the duties and requirements set out in Managing work closely with DCMS to ensure careful management Public Money. of recruitment of new Commissioners, so that at all times The executive has overall accountability for delivery of the the board has sufficient experience and expertise. Commission’s strategic objectives. It is supported by the Governance framework Finance and Performance Group, a group of programme The board of commissioners, led by the chair, Bill Moyes, directors and heads of function, which monitors progress oversees the business of the Commission. The day-to-day and resourcing in business plan delivery. activity of the Commission is managed by the leadership The Commission also reports on performance to DCMS, team, led by me as chief executive and accounting officer. sharing the data and information set out in the

Commissioners are responsible for the strategic management agreement. direction of the organisation and oversee delivery of the Commission’s business plan. Commissioners also retain direct responsibility for some regulatory decisions, such as complex licence applications.

29 Accountability report  Corporate governance report  The Commission’s governance structure

The Commission’s governance structure

Regulatory Board of Commissioners Panel

Delegated authorities National National Lottery Remuneration Determines ﬁnal result Lottery Competition Committee of cases in relation to Committee Committee licensing and enforcement decisions where an escalation is sought by Delegated Delegated Delegated Commission officials or authorities authorities authorities the licensee. Supports the Board Supports the Board Supports the Board and Accounting Officer and Accounting Officer and Accounting Officer in their respective in their respective in their respective responsibilities for: responsibilities for: responsibilities for:

 monitoring and  reviewing and  conﬁrming a strategic oversight of the NL approving the strategy, direction for appraisal operator and its business plan and and remuneration of performance budget for the the Chief Executive Competition  proposals for any  reviewing the regulatory action  agreeing associated performance project and business and remuneration  consideration of objectives proposed for senior applications for consent management Advisory for new ancillary activity  monitoring the delivery Groups of activities in  recruitment  budgetary accordance with the (as required) of the Advisory Board for requirements. Safer Gambling (ABSG) agreed business plan Chief Executive. Digital Advisory Panel  reviewing associated (DAP) risks, controls, Lived Experience Advisory delegations, Panel (LEAP). governance and processes.

30 Delegation Chief Executive Accountability

Finance and Management, Audit and Reset Performance Governance Risk Committee Project Board Committee and Assurance

Operational Boards Delegated Delegated Delegated and Groups authorities authorities authorities Management Board Supports the Board Supports the Board Oversight of cultural (strategy, structure, people) and Accounting Officer and Accounting Officer change programme, Senior Leadership Team in their respective in their respective Commissioners & (risk, resources, reporting) responsibilities for: responsibilities for: Executive members. Communications and Engagement  Setting a budget and  control and governance (proactive and reactive comms business plan  risk management and stakeholder engagement)  Scrutinising the ﬁnancial Finance and Performance Group  associated assurance. planning and policies Issue Management Group of the organisation Acts in an advisory Case Management Group role to the Board and  Monitoring performance Accounting Officer Policies against the budget and on appropriate internal Code of conduct for business plan. control and governance Commissioners arrangements. Employee code of conduct Delegated authority policy The committee has the Assurance delegated authority to: Information security policy Health and safety policy  appoint internal auditors. The NAO are Data protection policy external auditors based Key standards and on statute. procedures  recommend the Annual External Audit Corporate Strategy business Report and Accounts plan and budget to Board for approval. Risk management framework Management statement and memorandum (with DCMS) Statement of principles Bribery Act Internal Audit HM Treasury ﬁnancial reporting manual Managing Public Money.

31 Accountability report  Corporate governance report  Board performance

Board performance The Board The Board met formally twelve times during the year. It monitors and receives regular reports from its Audit and Risk, Remuneration, National Lottery and National Lottery Competition Committees.

Meeting attendance by Commissioners is given below, based on the number of meetings each Commissioner was eligible to attend based on their committee memberships:

Finance and National Lottery Audit and Performance Remuneration National Lottery Competition Commissioner Board Risk Committee Committee Committee Committee Committee Bill Moyes (Chairman) 12/12 N/A N/A N/A N/A N/A Terry Babbs1 (Chair of Finance and 10/12 N/A 7/7 N/A 6/9 N/A Performance Committee) John Baillie2 (Chair of Audit and Risk Committee) 12/12 5/6 N/A N/A N/A 12/13 Brian Bannister 11/12 2/3 7/7 N/A 7/9 N/A Carol Brady MBE 11/12 N/A N/A 5/5 N/A N/A Stephen Cohen (Chair of National Lottery 12/12 N/A N/A N/A N/A 13/13 Competition Committee) Jo Hill 10/12 3/3 7/7 N/A N/A N/A Sir Martin Narey3 1/1 N/A N/A N/A N/A N/A Trevor Pearce4 CBE QPM (Chair of National Lottery Committee 12/12 2/3 N/A 5/5 9/9 N/A and Remuneration Committee) Jonathan Scott5 1/12 N/A N/A N/A 1/9 N/A Catharine Seddon (Senior Independent Director) 11/12 2/2 N/A 5/5 N/A 13/13 Number of 12 6 7 5 9 13 meetings in year 1. Appointed Chair of Finance and Performance Committee from May 2020 2. Confirmed Chair of Audit and Risk Committee from May 2020 3. Resigned May 2020 4. Became Chair of Remuneration Committee from September 2019 5. Appointment ended 30 April 2020 Board meetings provide the opportunity for robust and Consistent with good practice, the Board undertook a constructive challenge and debate amongst board Board Effectiveness Review. It found the standard of members and senior management. As part of this performance was good, with improvements over the year process, Commissioners are required to disclose any in meeting management, but did identify some areas potential conflicts of interest, as set out in the Code of where effectiveness could be improved, centring on Conduct for Commissioners, which is available on our engagement, enhancing diversity and the use of decision- website. making by correspondence. An action plan was put in place to address all of the recommendations. During the year, a significant amount of time in formal board meetings was focused on monitoring progress The Board is supported by a number of Committees, against the delivery of the Commission’s Corporate all of which are outlined on the following pages. Details Strategy, taking action to protect consumers from harm, of the committee members and their attendance can and consideration of the policy issues relating to the next be found in the table above, while the remit and National Lottery Licence Competition. responsibilities of each Committee are set out in the Terms of Reference on our website.

32 Commissioners also spend time outside of board and Remuneration Committee committee meetings attending events and engaging The Remuneration Committee supports the Board and with stakeholders, as well as providing non-executive Accounting Officer in their responsibilities for performance advice on strategic projects. management, senior appointment departures and HR policies and practices. It also monitors progress with Senior Independent Director regards to culture, including the results of (and actions Consistent with the UK Corporate Governance Code resulting from) annual colleague engagement surveys. and with DCMS guidance, the Board has appointed a Senior Independent Director (SID) from among its National Lottery Committee current members. Catharine Seddon was appointed as The National Lottery Committee advises the Board and SID in June 2017. She was due to step down from this the Chief Executive in relation to the exercise of certain post in June 2020, but will now stay on in the role until Commission functions under the National Lottery etc. April 2022. Act 1993. The Committee has decision making powers in a number of areas delegated to it by the Board. The role of the SID is to provide a Board-level lead for high standards of governance, conduct the appraisal A signiﬁcant part of the Committee’s business is of the Chairman and act as a route to resolve any engagement with and review of the National Lottery concerns about the operation of the board. operator’s strategy and performance.

Audit and Risk Committee National Lottery Competition Committee The Audit and Risk Committee supports the Board The National Lottery Competition Committee advises the and the Accounting Officer in their responsibilities by Board and the Chief Executive in respect of the National monitoring the integrity of the Commission’s annual Lottery 4th Licence Competition, and through oversight statutory ﬁnancial statements, reviewing the Commission’s of the process of the Competition. The Committee has governance, internal control and risk management decision making powers in a number of areas delegated systems, and by reviewing the internal and external to it by the Board. As well as Commissioners, the audit services. In addition to Commissioners, the Audit Committee also has an independent member, David and Risk Committee also has an independent member, Rossington who was appointed on 31 July 2018. The Chris Andrew, who was appointed on 2 January 2019 Senior Responsible Officer for the Competition, John following the departure of previous independent member, Tanner, has also been a member of the Committee since Ann Harris. November 2019.

Finance and Performance Committee Regulatory Panel The Finance and Performance Committee was established The Regulatory Panel determines some licence in May 2020 as a result of the 2019 Board Effectiveness applications and deals with signiﬁcant regulatory Review. The Committee supports the Board and decisions which may include the revocation of licences. Accounting Officer in providing detailed scrutiny of the The Regulatory Panel sat on three separate occasions business plan and budget, ﬁnancial planning and during 2020-21, with each case requiring two or three organisational performance monitoring. Commissioners to attend for a full day hearing in addition to substantial preparation and review time.

33 Accountability report  Corporate governance report  Board performance

Board performance continued Advisory Board for Safer Gambling (ABSG) Risk and internal control framework The ABSG provides independent advice to the The Board and Audit and Risk Committee – oversee Commission on research, education and treatment the arrangements in place for the risk management programmes needed to support the new National function which operates within the Commission. This Strategy to Reduce Gambling Harms, along with the framework was reviewed and revised during 2020-21, associated funding requirements. The ABSG is chaired with the support of the Commission’s internal auditors. by Dr Anna van der Gaag CBE. Programme risk registers are reviewed monthly at Finance and Performance Group (FPG), and the Senior Leadership Digital Advisory Panel (DAP) Team consider the Corporate Risk Register and any The DAP comprises experts from the digital sector, escalations from FPG at their monthly meetings. including specialists in networks, social media, retail The Audit and Risk Committee receive the Corporate Risk and logistics. The Panel meets on a bi-monthly basis Register at least once a quarter, and Board discuss risk and provides the Commission with advice on matters twice a year. regarding technology, digital trends and the implications for the Commission as a regulator. The DAP is chaired The risk management strategy – the strategy outlines by Andy Payne. the objectives and policies for identifying and managing

Lived Experience Advisory Panel (LEAP) risk to the achievement of the Commission’s strategic As part of the Commission’s commitment to learning objectives and business plan. This also includes the from those with lived experience of gambling harms, Commission’s tolerance or appetite for risk. The the Commission worked with an interim group of experts framework sets out management roles and by experience in 2020 to co-design the LEAP advisory responsibilities, the process for identifying and recording group. LEAP began meeting in January 2021, and risk, allocating ownership of risk, evaluating risk, comprises 12 members, chaired by Charles Ritchie. determining responses to risk and monitoring and reporting on progress in managing risk. The framework Expert Advisory Group (EAG) applies to all levels of the organisation up to the Corporate The EAG provided advice and recommendations to the Risk Register. Fourth National Lottery Competition team. The work of EAG concluded at the end of 2019-20. The Commission’s risk tolerance is expressed through the level of residual risk judged acceptable for each risk Spending review 2021 identiﬁed. During 2021-22 there will be a spending review, we expect this to be a three-year funding settlement. Risk owners are required to identify and implement This does not affect the Commission in the same way mitigating actions to reduce the residual risk value to as other bodies, as our income is raised in the form an acceptable level.

of fees on gambling operators. However, there may The Commission’s governance framework sets out be some government wide efficiency targets that we have how the Board manages its affairs and which matters to take into consideration. This will be developed as part are delegated to the Chief Executive, or to other of our ongoing medium-term ﬁnancial planning process. employees or committees. This is reviewed periodically (typically every three years), with the most recent changes to the overarching framework being made in June 2020.

34 Specific aspects of this framework are reviewed more These risks are addressed as part of the budgeting frequently to ensure they remain fit for purpose. process, through prudent planning and long-term management of reserves. Throughout the year, the risk The internal audit programme focuses on the to the Commission’s income and expenditure profile is requirement to provide assurance that the risks faced continually reviewed through close monitoring of actual by the Commission are properly managed and controlled. income and expenditure and forecasts. Where control weaknesses are identified, these are drawn to the attention of senior managers, who are The Commission holds reserves as a matter of prudent responsible for determining and implementing an financial management, principally so that it can fund appropriate response. substantial legal action in furtherance of its regulatory objectives, manage short-term fluctuations in its licensing In their annual report, the Commission’s internal auditors income, and provide for foreseeable but not yet certain for 2020-21 (PwC) provide an independent opinion on the liabilities such as dilapidations. At present the Commission adequacy and effectiveness of the Commission’s system calculates that reserves of £3.5 million meet this of internal control, together with recommendations for requirement. Reserves were maintained at this level at improvement. the close of 2020-21 as a result of a Grant-in-Aid advance During the year, PwC carried out specific reviews on the from our sponsor department. As an arms-length body following subjects: the Commission does not hold reserve to cover terminal  Governance and Assurance – risk management liabilities as these would be met by its parent government framework department.  Financial Systems – managing income To ensure we maintain tight control over our expenditure  4th National Lottery Licence Competition we continually review our procurement arrangements.  Information and intelligence management A central contracts database is in place to ensure that  Performance reporting and monitoring procurement processes are compliant and all contracts  Business continuity and disaster recovery are brought in line with central frameworks where No fundamental weaknesses were identified in the applicable.

Commission’s control and assurance processes. There have been no reported actual or attempted frauds

Financial Management at the Commission during 2020-21. The Commission’s fee income continues to be subject However, given the high profile of the gambling industry to uncertainty, particularly given the impact of lockdown and the Commission within the public domain, it is during the Covid-19 pandemic, which we attempt to important that the Commission remains proactive in mitigate through regular review and re-forecast of income. identifying instances where there is potential for fraud Whilst we forecast prudently, in the event of losing a and corruption. The quality assurance mechanisms further significant proportion of our income, there remains which have been developed for the compliance and a risk that we may not be able to reduce our expenditure enforcement processes depend on accurate, timely and (which is largely employee-based) as swiftly as needed to complete information to help safeguard the Commission's avoid larger in-year deficits than currently planned within professional integrity and improve operational efficiency. the medium-term financial plan.

35 Accountability report  Corporate governance report  Board performance

Board performance continued

Internal control framework The Commission has in place a wide range of internal at each meeting. In addition, the Commission also controls to manage the risk of failure to achieve strategic undertakes monthly financial re-forecasts to ensure that objectives. These include: financial management of the Commission remains robust. This is reviewed by the Board. Organisational structure and delegation of authority The Commission is currently organised into business Review and sign-off of actions areas and functions that bring together related The Commission has a series of checks and balances in operational, project and thematic activity. place across the organisation to ensure that decisions and outcomes are appropriately reviewed. Quality assessment Authority to make decisions and authorise expenditure reviews have been undertaken within a number of the is delegated to the appropriate level of responsibility compliance areas to ensure that regulatory activity within each business area. continues to be of high quality. Management also reviews Policies and procedures outputs within a range of frontline and support areas Comprehensive policies and supporting procedures to ensure accuracy and relevance. These controls are are in place across the Commission at a corporate and subject to internal and external audit review as part operational level. A thorough review of all financial policies of the internal audit plan and external audit fieldwork. was undertaken during 2018/19 to ensure that they remain compliant with Managing Public Money (MPM) Public Interest Disclosure Policy The Commission has a public interest disclosure policy and that they reflect best practice. An updated suite in place for the confidential reporting of unlawful conduct of financial policies, reviewed under the MPM project, or malpractice. The policy is available online for all was in place during the financial year. The Finance and employees and is available to the public via the website. Performance Committee will routinely review financial As part of their induction programme all new Commission policies on an approved schedule. The appropriateness employees are required to confirm in writing that they of Commission policies and procedures is periodically have read the Code of Conduct, including the public reviewed by internal audit as part of the audit plan. interest disclosure policy.

Operational and ﬁnancial reporting Personal data incidents The Commission reviews and updates its business plan There was one substantive data security incident during on an annual basis and prepares an annual budget 2020-21 (nil during 2019-20). to support the delivery of the plan. Effectiveness of internal controls The budget also considers risks and uncertainties to The Commission's senior management reviews the ensure that these can be mitigated where possible. operational effectiveness of the current internal controls Both of these elements are reviewed and approved using a combination of the Corporate Risk Register, by the Board along with progress against the business and operational and ﬁnancial performance reports.

plan. In this they are supported by the Finance and This is supported by the annual programme of internal Performance Committee’s routine scrutiny of the business audit reviews into the design of controls and whether plan and budget. Financial performance is reported those controls have been operating effectively. to the Board and Finance and Performance Committee

36 Through their work during the year, the internal As a result of the work completed we identified 3 high risk auditors have concluded: findings, 11 medium risk findings and 6 low risk findings. Major improvement required At the year end, we tested the implementation of 25 We identified some significant weaknesses and non- internal audit recommendations (which were due for compliance (during the year and at year end) in the action during the year). We obtained evidence to show framework of governance, risk management and control that 24 out of 25 of these actions, (including all five which put the achievement of organisational objectives of the high-risk findings due for implementation by at risk. Major improvements are required to improve 31 March 2021) had been addressed. Two of these five the adequacy and effectiveness of governance, risk high risk actions related to reports completed from the management and control. 2020/21 internal audit plan. We also completed two Internal auditors’ statement advisory reviews which focused on governance and risk PWC acknowledge that the internal audit 2020/21 which management and performance management/reporting. was developed in conjunction with management and The Commission had identified that the processes and approved by the Audit and Risk Committee was designed controls in both of these areas needed strengthening. to focus on areas of higher risk at the Commission. Our role was to assess the Commission’s plans for making improvements and we made a number of The key factors that contributed to their opinion are recommendations, to strengthen core areas of the summarised as follows: control environment. Of the five risk rated reports that we issued in 2020/21, three reports were rated as ‘Needs Improvement’. We note the positive and constructive communications we These reports were: have had with management in agreeing recommendations and action plans. We also recognise the focus being  Business Continuity/Disaster Recovery placed on follow-up of recommendations by the Audit  National Lottery 4 – ITA Evaluation Model and Risk Committee. The senior management of the  Information and Intelligence Management. organisation has taken steps to ensure that all agreed audit recommendations are actioned in an appropriate timescale, and all high-risk findings which were due by the end of the year have been completed.

37 Accountability report  Corporate governance report  Board performance

Board performance continued

Principal risks and uncertainties facing the Commission The principal risks and uncertainties are managed through the Commission’s Corporate Risk Register as part of the internal control framework. The most signiﬁcant risks facing the Commission as of the end of March 2020 are:

Risks and uncertainties Existing and Planned Mitigations Income from fees, grant in aid and Existing the use of available reserves does  Progress with fees review and liaison with DCMS. not cover expenditure.  Income re-forecasting.  The Commission’s MTFP including robust cost saving plans.  Further ﬁnancial management controls. Planned  Review of Fees Framework – linked to the Gambling Act Review.

The COVID-19 pandemic increases Existing risks to the licensing objectives and  Comprehensive homeworking arrangements allow full range of regulatory NL duties, adversely impacts our activities to be undertaken. ability to respond to risks and  Alternative vehicles to collect data. prevents sufficient ﬁeldwork leaving  Close cross functional working and intelligence monitoring ensures data gaps on key metrics. identiﬁcation and response to any changing risks. Planned  Move to new methods of data collection. Consultation response due July 2021.

Competition fails to generate Existing sufficient market interest, competitive  Multiple rounds of market engagement completed before launch of tension and sufficient credible bids competition, including making draft Invitation To Apply (ITA) and Licence available to potential applicants. to obtain a successful 4th Licence holder.  Outline Business Case and Addendum approved by DCMS and HMT May 2020.  Competition launched in August 2020 with Selection Questionnaire made available to potential applicants.  ITA issued to successful applicants in October 2020, with applications due mid-April 2021.  Extensive process of clariﬁcation questions and responses with all applicants during preparation of Phase 1 applications and separate process of feedback on licensability of proposed new games in portfolio.  Throughout the year the potential impact of COVID-19 impact on the competition was kept under review. Planned  Assessment of Phase 1 applications and feedback to applicants in mid-July 2021, with no down-select at Phase 1.  In addition to applicant speciﬁc feedback, applicant notes will be issued to provide further guidance to applicants generally.  Lessons learned from Phase 1 will be built into Phase 2 evaluation.  Full Business Case to be submitted to DCMS and HMT in Q3 21/22.

38 Risks and uncertainties Existing and Planned Mitigations There is a risk of failing to transition Existing from the Third to Fourth licence in a  Licensing obligations are currently in place to support an effective coherent way. handover (for example, asset condition is guaranteed for two years post expiry of the Third Licence).  Appointed dedicated internal leads for the management of the transition risk and associated decisions on technology.  Heads of Terms of Enabling agreement to be shared with market before competition launch.  Heads of Terms of Co-operation agreement to be shared with market before competition launch.  The Commission has provided the incumbent and applicants with an Enforcement Statement of Practice in respect of transition.  The onboarding of the TTO Work Package: Providing expertise and experience in supporting / assuring the transition.  Review of applicant transition plans at Phase 1 against the time allocated for the Implementation Stage. Planned  Review of applicant transition plans at Phase 2 against the time allocated for the Implementation Stage.  The proposed approach to document execution of the Co-operation Agreement, Enabling Agreement and Deed of Commitment is intended to mitigate the risk of poor cooperation between the parties, non- compliance, and reduce delay to transition due to negotiation.

A substantive reduction in the Existing Commission’s delivery capacity  Home working arrangements and IT support in place to support colleagues. affects our ability to meet our stated  Business plans continually reviewed to identify impact of reduced resources outcomes and duties. on deliverables.  Monitor Sickness Absence and provide advice to managers in line with policy.  Provision and promotion of Wellbeing support including Employee Assistance Programme and Occupational Health Services including provision of bespoke ‘Talking Thru the Pandemic’ wellbeing sessions. Planned  Senior Leadership Team Deep dive session to review the risk impact and mitigations, and work priorities.  Covid Working Group developing plans regarding longer term working arrangements.  Detailed analysis of attrition data to identify trends and issues to resolve.

The Bet Index case reveals the Existing challenge of co-regulation.  Enforcement casework including suspension.  Close working with key stakeholders including DCMS, Administrators, solicitors and FCA.  Signiﬁcant comms with MPs, journalists, and consumers (via website).  Review of comparable products in the market. Planned  Developing a Memorandum of Understanding with the FCA to contain a framework to engage and resolve any future regulatory remit challenges.

39 Accountability report  Remuneration and staff report  Remuneration report Remuneration and staff report Remuneration report This report covers the 12 months ending 31 March 2021 and sets out the policy and disclosures in relation to the remuneration of the Commissioners and senior managers of the Commission. Commissioners Independent member of The Chairman and Commissioners are appointed by the Audit and Risk Committee Secretary of State on terms set on the basis of advice The Commission appointed Chris Andrew on a three-year from the Civil Service Senior Salaries Review Body. contract with effect from 2 January 2019 as an independent member of the Audit and Risk Committee, Appointments are for a period of between three and for which a payment is made. His appointment ﬁve years and may be renewed for a further term. followed the departure of previous independent Appointments may be terminated at any time by member, Ann Harris. either party giving written notice. Senior managers Bill Moyes was appointed as Chairman for a ﬁve-year term Senior managers are normally employed directly by the commencing 5 September 2016. His contract provides Commission. Increases in pay are performance based for the Chairman to work two days per week on average. and are broadly in line with senior Civil Service pay bands. Commissioners work on average one day per week. Performance targets are set and measured in accordance Commissioners’ contracts may be terminated by written with the Commission’s policy on pay and reward. notice where the Secretary of State has reason to believe The process for the agreement of the executive teams’ that the Commissioner has been absent from Commission performance targets, achievements against targets, meetings, without explanation, for a period of longer and recommendations on changes in remuneration, is than three months; has become bankrupt or made reviewed by the Remuneration Committee. Except during an arrangement with a creditor; has been convicted of probation or where guilty of gross misconduct, senior a criminal offence; has breached the Code of Conduct managers’ contracts may be terminated by either party for Board members; or has become incapacitated by giving 12 weeks written notice. physical or mental illness. Details of all executive directors serving during the year The Commissioners’ appointments are not pensionable are provided at Appendix 1 from page 78, including the under the Civil Service pension scheme and no duration of their service. contributions have been paid by the Commission to any other scheme. Remuneration (including salary) and pension entitlements Diversity breakdown for the Board of Commissioners: The following sections provide details of the remuneration Male Board members 70% and pension interests of the Commissioners and Female Board members 30% Directors. This has been subject to audit review.

40 Remuneration of Senior Managers (salary, expenses and payments in kind) – audited information 2020-21 2020-21 2020-21 2020-21 2020-21 2019-20 2019-20 2019-20 2019-20 2019-20 Bonus Expenses Pension Bonus Expenses Pension Salary Payments as BiK** Benefits Total Salary Payments as BiK** Benefits Total (in bands (in bands (to nearest (to nearest (in bands (in bands (in bands (to nearest (to nearest (in bands Directors of £5k) of £5k) £100) £1,000 ) of £5k) of £5k) of £5k) £100) £1,000 ) of £5k) Victoria Beaumount 100-105 – – 41,000 140-145 100-105 0-5 – 39,000 140-145 Executive Director – HR Sarah Gardner 115-120 75-80 Deputy Chief Executive (Joint Acting (130-135 – – 99,000 215-220 (105-110 – – 33,000 110-115 Chief Executive – from 12 February 2021) fye)* fye)* Sally Jones Chief Operating Officer 45-50 (from 26 Oct 20) (Joint Acting Chief (120-125 – – 19,000 65-70 – – – – – Executive – from 12 February 2021) fye)* Neil McArthur Chief Executive 145-150 – – 71,000 215-220 140-145 10-15 – 59,000 215-220 (left the organisation 30 June 2021) Tim Miller Executive Director – 110-115 – – 43,000 150-155 105-110 5-10 – 43,000 160-165 Insight and Safer Gambling 20-25 Marie Perry 100-105 – – 40,000 140-145 (100-105 – – 10,000 30-35 Chief Financial Officer fye)* 100-105 John Tanner 140-145 – – 165,000 305-310 (135-140 – – 314,000 415-420 Executive Director – 4NLC fye)* 90-95 Alistair Quigley 95-100 – – 53,000 150-155 (95-100 0-5 – 59,000 150-155 Chief Technology Officer fye)* Helen Venn Executive Director – 100-105 – – 41,000 140-145 95-100 0-5 – 40,000 140-145 Licensing and Compliance Richard Watson Executive Director – 100-105 – – 41,000 140-145 95-100 0-5 – 40,000 145-150 Enforcement and Intelligence Former Employees Ann Harris 10-15 Interim Executive Director –4NLC – – – – – (60-65 – 300 4,000 10-15 (from 30 July 2018 to 31 May 2019) fye)* Nicky Heathcote 15-20 Interim Executive Director – Regulatory – – – – – (100-105 – – 25,000 40-45 Policy and Governance fye)* (from 21 May 2018 to 31 May 2019) Paul Hope Executive Director – 75-80 Consumers and Regulatory Strategy (100-105 – – 35,000 110-115 100-105 0-5 – 93,000 195-200 (to 31 December 2020) fye)* Philip Lloyd Chief Financial Officer – – – – – 100-105 0-5 – 93,000 195-200 (from 30 July 2018 to 17 January 2020) Tamsin Morgan 90-95 Director of Communications (100-105 – – – 90-95 95-100 – – – 95-100 (to 19 February 2021) fye)* David Pemberton 30-35 Executive Director – – – – – (100-105 – – 12,000 40-45 – digital and planning fye)* (from 19 June 2017 to 19 July 2019) Natalie Prosser 20-25 General Counsel (from 02 November 2020 (90-95 – – 12,000 30-35 – – – – – to 31 January 2021) fye)* Band of highest paid directors 145-150 155-160 total remuneration (£'000) Median total remuneration 39,163 36,754 Range of staff remuneration (£'000) 18 to 145-150 18 to 155-160 Median pay ratio 3.76:1 4.29:1 The average percentage change in base salary 2% from the previous financial year in respect of the employees of the entity taken as a whole. Fair pay disclosures: 2020-21 Highest paid director percentage 2% change in base salary from previous financial year.

* fye = full-year equivalent ** BiK = Beneﬁts in Kind

41 Accountability report  Remuneration and staff report  Remuneration report

Remuneration report continued Remuneration of Commissioners (salary, expenses and payments in kind) – audited information 2020-21 2020-21 2020-21 2020-21 2020-21 2019-20 2019-20 2019-20 2019-20 2019-20 Bonus Expenses Pension Bonus Expenses Pension Salary Payments as BiK** Benefits Total Salary Payments as BiK** Benefits Total (in bands (in bands (to nearest (to nearest (in bands (in bands (in bands (to nearest (to nearest (in bands Commissioners of £5k) of £5k) £100) £1,000 ) of £5k) of £5k) of £5k) £100) £1,000 ) of £5k) Chris Andrew 0-5 – 1,200 – 0-5 Independent Audit Committee Member 0-5 – – – 0-5 David Rossington 0-5 – – – 0-5 Independent Committee Member NL 0-5 – – – 0-5 Terry Babbs (from 30 April 2020) 10-15 – – – 10-15 – – – – – John Baillie 10-15 – 600 – 10-15 10-15 – 3,900 – 15-20 Brian Bannister (from 30 April 2020) 10-15 – – – 10-15 – – – – – Carol Brady 10-15 – – – 10-15 10-15 – 400 – 10-15 Stephen Cohen 10-15 – 100 – 10-15 10-15 – 1,400 – 15-20 0 0 Jo Hill*** (from 30 April 2020) (10-15 – – – (10-15 – – – – – fye)* fye)* Bill Moyes Chairman 55-60 – 800 – 55-60 55-60 – 7,600 – 60-65 Trevor Pearce 10-15 – – – 10-15 10-15 – 2,500 – 15-20 Catharine Seddon 10-15 – 100 – 10-15 10-15 – 800 – 10-15 Previous non executives Alison Hastings (to 30 August 2019) – – – – – 5-10 – 900 – 5-10 Martin Narey 0-5 – – – 0-5 – – – – – (From 30 April 2020 to 31 May 2020)) Sarika Patel (to 25 November 2019) – – – – – 5-10 – 600 – 10-15 Simone Pennie (to 31 May 2019) – – – – – 0-5 – – – 0-5 Jonathan Scott (to 30 April 2020) 0-5 – – – 0-5 10-15 – 1,400 – 15-20 * fye = full-year equivalent, ** BiK = Benefits in Kind, *** Jo Hill has not received any payments from the Commission during 2020-21 due to existing employment commitments from her employer, she will be paid by the Commission from April 21 onwards.

Salary: ‘Salary’ includes gross salary, overtime, reserved Bonuses: Bonuses are based on performance levels rights to London weighting or London allowances, attained and are made as part of the appraisal process. recruitment and retention allowances, private office Bonuses relate to the performance in the year in which allowances and any other allowance to the extent that it they become payable to the individual. There were is subject to UK taxation. This report is based on accrued no bonuses paid to Directors during 2020-21, the payments made by the Commission and thus recorded comparative bonuses reported for 2019-20 relate in these accounts. to the performance in 2019-20.

Apart from the Chair and Chief Executive, all Pay multiples – audited information: The Commission Commissioners are paid a ﬁxed amount for work that is required to disclose the relationship between the entails approximately one day of time per week. No remuneration of the highest-paid director in their employees or Commissioners were remunerated by organisation and the median remuneration of the way of service companies or third parties. Commission’s workforce.

Expenses as benefits in kind: The Commission incurred The banded remuneration of the highest paid director costs for travel, subsistence and accommodation in in the Commission in the financial year 2020-21 was respect of the Chairman and the Commissioners whilst £145,000-£150,000 (2019-20, £155,000-£160,000). attending meetings at Victoria Square House. These This was 3.76 times (2019-20, 4.29 times) the median expenses could be viewed as benefits in kind and treated remuneration of the workforce, which was £39,163 by HM Revenue & Customs as a taxable emolument. (2019-20, £36,754). To avoid doubt, such taxes are paid by the Commission.

42 In 2020-21, 0 (2019-20, 0) employees received Total remuneration includes salary, non-consolidated remuneration in excess of the highest paid director. performance-related pay and beneﬁts-in-kind. It does not Remuneration ranged from £18,000 to £147,000 include severance payments, employer pension contributions (2019-20, £18,000-£158,000). and the cash equivalent transfer value of pensions.

Pension beneﬁts 2020-21 – audited information

Accrued Accrued Lump Real increase Employer pension at Sum pension at Real increase in pension contribution to pension age as pension age as in pension at Lump Sum at Real partnership at 31/03/21 at 31/03/21 pension age pension age * CETV at * CETV at increase pension 31/03/21 31/03/20 in CETV* account (in bands of (in bands of (in bands of (in bands of £5,000) £5,000) £2,500) £2,500) £'000s £'000s £'000s (nearest £100) Victoria Beaumount 5-10 – 0-2.5 – 69 41 18 – Executive Director – HR Sarah Gardner Deputy Chief Executive 35-40 75-80 5-7.5 5-7.5 580 497 59 – (Joint Acting Chief Executive) Sally Jones Chief Operating Officer 0-5 – 0-2.5 – 15 – 12 – (Joint Acting Chief Executive) (From 26 October 2020) Neil McArthur 55-60 120-125 2.5-5 0-2.5 1,085 1,000 45 – Chief Executive (to 30 June 2021) Tim Miller Executive Director 10-15 – 2.5-5 – 111 83 17 – – Insight and Safer Gambling Marie Perry 5-10 – 0-2.5 – 78 51 18 – Chief Financial Officer John Tanner 60-65 185-190 7.5-10 22.5-25 1,466 1,251 167 – Executive Director – 4NLC Alistair Quigley 25-30 – 2.5-5 – 408 356 33 – Chief Technology Officer Helen Venn Executive Director 35-40 – 0-2.5 – 510 463 23 – – Licensing and Compliance Richard Watson Executive Director 15-20 – 0-2.5 – 257 214 26 – – Enforcement and Intelligence Former Employees Paul Hope Director – Consumers and Regulatory 40-45 90-95 0-2.5 0-2.5 727 698 21 – Strategy (to 31 December 2020) Tamsin Morgan Director of Communications – – – – – – – – (to 19 February 2021)

Natalie Prosser General Counsel (from 2 November 20-25 – 0-2.5 – 291 275 5 – 2020 to 31 January 2021)

* CETV = Cash Equivalent Transfer Values

43 Accountability report  Remuneration and staff report  Remuneration report

Remuneration report continued Civil Service Pensions Pension beneﬁts are provided through the Civil Service pension with an employer contribution (partnership pension arrangements. From 1 April 2015 a new pension pension account).

scheme for civil servants was introduced – the Civil Employee contributions are salary-related and range Servants and Others Pension Scheme or alpha, which between 4.6% and 8.05% for members of classic, provides benefits on a career average basis with a normal premium, classic plus, nuvos and alpha. Benefits in pension age equal to the member’s State Pension Age classic accrue at the rate of 1/80th of final pensionable (or 65 if higher). From that date all newly appointed civil earnings for each year of service. In addition, a lump servants and the majority of those already in service joined sum equivalent to three years initial pension is payable alpha. Prior to that date, civil servants participated in the on retirement. For premium, benefits accrue at the rate Principal Civil Service Pension Scheme (PCSPS). The of 1/60th of final pensionable earnings for each year of PCSPS has four sections: three providing benefits on service. Unlike classic, there is no automatic lump sum. a final salary basis (classic, premium or classic plus) Classic plus is essentially a hybrid with benefits for with a normal pension age of 60; and one providing service before 1 October 2002 calculated broadly as per benefits on a whole career basis (nuvos) with a normal classic and benefits for service from October 2002 pension age of 65. worked out as in premium. In nuvos a member builds

These statutory arrangements are unfunded with the cost up a pension based on pensionable earnings during their of benefits met by monies voted by Parliament each year. period of scheme membership. At the end of the scheme Pensions payable under classic, premium, classic plus, year (31 March) the member’s earned pension account is nuvos and alpha are increased annually in line with credited with 2.3% of their pensionable earnings in that Pensions Increase legislation. Existing members of the scheme year and the accrued pension is uprated in line PCSPS who were within 10 years of their normal pension with Pensions Increase legislation. Benefits in alpha build age on 1 April 2012 remained in the PCSPS after 1 April up in a similar way to nuvos, except that the accrual rate 2015. Those who were between 10 years and 13 years in 2.32%. In all cases members may opt to give up and five months from their normal pension age on 1 April (commute) pension for a lump sum up to the limits 2012 will switch into alpha sometime between 1 June set by the Finance Act 2004.

2015 and 1 February 2022. All members who switch to The partnership pension account is a stakeholder pension alpha have their PCSPS benefits ‘banked’, with those arrangement. The employer makes a basic contribution with earlier benefits in one of the final salary sections of between 8% and 14.75% (depending on the age of of the PCSPS having those benefits based on their the member) into a stakeholder pension product chosen final salary when they leave alpha. (The pension figures by the employee from a panel of providers. The employee quoted for officials show pension earned in PCSPS or does not have to contribute, but where they do make alpha – as appropriate. contributions, the employer will match these up to a limit

Where the official has benefits in both the PCSPS and of 3% of pensionable salary (in addition to the employer’s alpha the figure quoted is the combined value of their basic contribution). Employers also contribute a further benefits in the two schemes.) Members joining from 0.5% of pensionable salary to cover the cost of centrally- October 2002 may opt for either the appropriate defined provided risk benefit cover (death in service and ill health benefit arrangement or a ‘money purchase’ stakeholder retirement).

44 The accrued pension quoted is the pension the member pension benefits at their own cost. CETVs are worked is entitled to receive when they reach pension age, or out in accordance with The Occupational Pension immediately on ceasing to be an active member of the Schemes (Transfer Values) (Amendment) Regulations scheme if they are already at or over pension age. Pension 2008 and do not take account of any actual or potential age is 60 for members of classic, premium and classic reduction to benefits resulting from Lifetime Allowance plus, 65 for members of nuvos, and the higher of 65 or Tax which may be due when pension benefits are taken. State Pension Age for members of alpha. (The pension Real increase in CETV figures quoted for officials show pension earned in This reflects the increase in CETV that is funded by the PCSPS or alpha – as appropriate. Where the official employer. It does not include the increase in accrued has benefits in both the PCSPS and alpha the figure pension due to inflation, contributions paid by the quoted is the combined value of their benefits in the employee (including the value of any benefits transferred two schemes but note that part of that pension may from another pension scheme or arrangement) and uses be payable from different ages.) common market valuation factors for the start and end Further details about the Civil Service pension of the period. arrangements can be found at the website Compensation for loss of office www.civilservicepensionscheme.org.uk – audited information Cash Equivalent Transfer Values (CETV) 27 employees left under Voluntary Exit terms during the A Cash Equivalent Transfer Value (CETV) is the actuarially period 30 June 2020 and 7 February 2021. They received assessed capitalised value of the pension scheme separate compensation payments totalling £1,012,350. benefits accrued by a member at a particular point in time. None of the employees effected were senior managers or The benefits valued are the member’s accrued benefits executives. and any contingent spouse’s pension payable from the Remuneration Committee scheme. A CETV is a payment made by a pension The members of the Remuneration Committee consists scheme or arrangement to secure pension benefits in of Trevor Pearce (Chair), Carol Brady and Catharine another pension scheme or arrangement when the Seddon. Catharine joined the Committee in 2020 with member leaves a scheme and chooses to transfer the her first meeting in July 2020. (Details of Commissioners benefits accrued in their former scheme. The pension can be found from page 24). figures shown relate to the benefits that the individual has accrued as a consequence of their total membership of the pension scheme, not just their service in a senior capacity to which disclosure applies.

The figures include the value of any pension benefit in another scheme or arrangement which the member has transferred to the Civil Service pension arrangements. They also include any additional pension benefit accrued to the member as a result of their buying additional

45 Accountability report  Remuneration and staff report  Staff report

Staff report a) Analysis of Commissioners and employee costs – audited information

2020-21 2020-21 2020-21 2019-20 Permanent Short term Total Total £’000s £’000s £’000s £’000s Salaries and wages 15,407 573 15,980 14,321 Social security costs 1,492 65 1,557 1,512 Other pension costs 3,686 165 3,851 3,658 Total Commissioners and staff costs 20,585 803 21,388 19,491

b) Retirement benefits contribution. Employers’ contributions of £52,528 The following disclosures are made in accordance with (2019-20: £53,405) were paid to one or more of the IAS 19, 'Employee Benefits'. panel of three appointed stakeholder pension providers. Employer contributions are age-related and ranged from (i) Employees The Commission provides pension benefits for permanent 8 to 14.75% (2019-20: 8 to 14.75%) of pensionable pay. staff under the Principal Civil Service Pension Scheme Employers also match employee contributions up to 3% (PCSPS). The PCSPS is an unfunded multi-employer of pensionable pay. In addition, employer contributions defined benefit scheme in which the Commission is of £0, 0.0% of pensionable pay, were payable to the unable to identify its share of the underlying assets and PCSPS to cover the cost of the future provision of lump liabilities. A full actuarial valuation was carried out as at sum benefits on death in service or ill health retirement 31 March 2021. Details can be found in the resource of these employees. accounts of the Cabinet Office: Civil Superannuation Contributions due to the partnership pension providers at (www.civilservice-pensions.gov.uk). the balance sheet date were £370,193. No contributions For 2020-21, employers' contributions of £3,789,953 were pre-paid. were payable to the PCSPS (2019-20: £3,608,473) (ii) Former Director General – OFLOT at one of four rates in the range 26.6% to 30.3% Upon the merger between the Gambling Commission (2019-20: 26.6% to 30.3%) of pensionable pay, and the National Lottery Commission in 2013, the based on salary bands. Commission inherited a pension liability for a former The Scheme Actuary reviews employer contributions Director General of OFLOT from 1993 to 1998. This usually every four years following a full scheme valuation. pension is an unfunded defined benefit scheme which The salary bands and contribution rates were revised for has benefits by analogy to the PCSPS (for details see 2019-20 and will remain unchanged until 2021-22. The www.civilservice.gov.uk/pensions) and is paid directly contribution rates reflect benefits as they are accrued, from the Commission's own funds. In 2001, upon the not when the costs are actually incurred, and reflect past recipient reaching retirement age, pension payments experience of the scheme. The contribution rates are set commenced. to meet the cost of the benefits accruing during 2020-21 A full actuarial valuation of both schemes was carried to be paid when the member retires and not the benefits out by the Government Actuary at 31 March 2021 paid during this period to existing pensioners. and the present value of the liability at 31 March 2021 Employees can opt to open a partnership pension is £215,000. account, a stakeholder pension with an employer

46 Sensitivity analysis 1. Increasing the discount rate by 0.5% would result in a The opposite changes in assumptions to those set out corresponding decrease in liabilities of approximately above would produce approximately equal and opposite £9,000 or 4%. changes in the liability. Similarly, doubling the changes

2. Increasing the CPI inﬂation assumption by 0.5% in the assumptions would produce approximately double would result in a corresponding increase in liabilities the changes in the liability. of approximately £9,000 or 4%. The sensitivities show the change in each assumption

3. Increasing assumed life expectancies in retirement in isolation. In practice the ﬁnancial assumptions rarely by around one year would result in a corresponding change in isolation and given the interdependencies increase in liabilities of approximately £7,000 or 3%. between them, the impacts of such changes may offset each other to some extent.

Under IAS 19 the Commission is required to show the present value of these liabilities on its Statement of Financial Position.

Financial assumptions The main ﬁnancial assumptions and life expectancy assumptions used by the actuary in calculation of the liability for the schemes are as follows:

31 March 2021 31 March 2020 Discount rate for scheme liabilities 1.25% 1.80% Rate on increase in salaries 2.22% 2.35% Rate of increase for pensions in payment, in line with inflation 2.22% 2.35% CPI inflation assumption 2.22% 2.35%

Life expectancy at retirement Current Pensioners As at 31 March 2021 As at 31 March 2020 Exact Age men (years) women (years) men (years) women (years) 60 26.9 28.6 26.8 28.4 65 22.0 23.7 21.9 23.5 c) Average number of persons employed – audited information The average number of whole-time equivalent persons employed during the year was as follows:

2020-2021 2019-2020 Permanent staff 327 331 Other staff 11 20 Staff engaged on capital projects – – Total 338 351

47 Accountability report  Remuneration and staff report  Staff report

Staff report continued d) Off-payroll appointments

i For all off-payroll engagements as of 31 March 2021, for more than £245 per day and that last for longer than six months No. of existing engagements as of 31 March 2021 nil of which... No. that have existed for less than one year at time of reporting. nil No. that have existed for between one and two years at time of reporting. nil No. that have existed for between two and three years at time of reporting. nil No. that have existed for between three and four years at time of reporting. nil No. that have existed for four or more years at time of reporting. nil Conﬁrmation that all existing off-payroll engagements, outlined above, have at some point been subject to a risk based assessment as to whether assurance is required that the individual is nil paying the right amount of tax and, where necessary, that assurance has been sought. ii For all new off-payroll engagements, or those that reached six months in duration, between 1 April 2020 and 31 March 2021, for more than £245 per day and that last for longer than six months No. of new engagements, or those that reached six months in duration between 1 April 2020 and 31 March 2021 1 of which... No. assessed as caught by IR35. 1 No. assessed as not caught by IR35. nil

No. engaged directly (VIA PSC contracted to department) and are on the departmental payroll. nil No. of engagements reassessed for consistency / assurance purposes during the year. nil No. of engagements that saw a change to IR35 status following the consistency review. nil iii. For any off-payroll engagements of board members, and/or senior officials with significant financial responsibility, between 1 April 2020 and 31 March 2021 No. of off-payroll engagements of board members, and/or, senior officials with significant financial nil responsibility, during the financial year. Total no. of individuals on payroll and off-payroll that have been deemed ‘board members, and/or, 21 senior officials with significant financial responsibility’ during the financial year.

Reporting of Civil Service and other compensation schemes – exit packages – audited information

2020-21 2019-19 Exit package cost Other Total exit Other Total exit band (including any Compulsory departures packages by Compulsory departures packages by special payment element) redundancies agreed cost band redundancies agreed cost band Number Number Number Number Number Number Less than £10,000 – – – – – – £10,001 – £25,000 1 13 14 – 4 4 £25,001 – £50,000 – 8 8 – 1 1 £50,001 – £100,000 – 8 8 – 1 1 £100,001 – £150,000 – – – – – – £150,001 – £200,000 – – – – – – >£200,000 – – – – – – Total number of exit packages 1 29 30 – 6 6

Total cost (£) 19,981 1,124,603 1,144,584 – 195,524 195,524

48 Redundancy and other departure costs have been paid Where the department has agreed early retirements, in accordance with the provisions of the Civil Service the additional costs are met by the department and not Compensation Scheme, a statutory scheme made under by the Civil Service pension scheme. Ill-health retirement the Superannuation Act 1972. The table on the previous costs are met by the pension scheme and are not page shows the total cost of exit packages agreed and included in the table. accounted for in 2020-21 (2019-20 comparative ﬁgures Consultancy costs are also given). £1,012,350 exit costs (27 exits) were As per Note 3(b) of the Annual Accounts, consultancy paid in 2020-21, the year of departure. Exit costs are costs totalling £2.0m (2019-20: £1.02m), £1.8m relates accounted for in full in the year of departure. Provisions to increased costs relating to the National Lottery have been created for 3 exits which have been agreed Competition on consultancy assignments. in year, but with a departure date after 31 March 2021.

Employment Statistics for 2020-21 (as at 31 March 2021)

Total Employment by contract type Diversity – disability Fixed Term Employees 16 Employees with a disability as 16 Permanent Employees 319 deﬁned under the Equality Act 2010 Total 335 Employees without a disability as 9 deﬁned under the Equality Act 2010 Department split Not disclosed 310 Strategy 13 Total 335 Research, Statistics & Policy 37 Regulatory Projects 2 Diversity – ethnic origin PMO 6 Asian or Asian British – Indian 16 People Services 11 Asian or Asian British – Other 0 NSRGH 7 Asian or Asian British – Pakistani 8 Licensing 42 Black or Black British – African 2 Legal 6 Black or Black British – Caribbean 5 Enforcement & Intelligence 48 Mixed – White and Asian 3 Governance 6 Mixed – White & Black Caribbean 4 Finance 12 Not Disclosed 34 Facilities 4 Other Ethnic Background 4 Executive 6 Other Mixed Background 0 Executive Support 8 Other White Background 5 Digital & Technology 31 White British 244 Data Infrastructure Projects 1 White Irish 4 Contact Centre 14 Prefer Not to Say 6 Compliance 36 Total 335 Communications 9 4NLC 19 3NL, Policy & Major Projects 17 Total 335

49 Accountability report  Remuneration and staff report  Staff report

Staff report continued

Diversity – age Sickness rates 24 and under 10 During the year, the average proportion of working days 25-34 88 lost to sickness was 1.84% (2019-20: 5.08%) which 35-44 109 includes long term absence related to mental health, 45-54 86 covid/covid related, underlying health conditions and 55-64 42 65-74 0 extended periods of recovery following operations. Our Total 335 occupational health and employee assistance partners are providing us with ongoing support for colleagues Diversity – gender and management alike. Female 172 Male 163 Trade Union facility time Total 335 Relevant union officials Number of employees who were relevant Sickness absence rates 9.00 union officials during 2020-21 1 April 2019 to March 2020 % of working days lost Full time equivalent employees who were relevant 8.63 Quarter 1 1.30 union officials during 2020-21 Quarter 2 1.30 Quarter 3 2.67 Percentage of time spent on facility time Quarter 4 2.09 % Number of employees Total 1.84 0 – Policies and procedures 1-50 9 The Commission has a range of policies and procedures 51-90 – in place relating to recruitment, sickness absence, 100 – learning and development and Dignity at Work. Each Percentage of pay bill spent on facility time £'000s of our policies aim to achieve fair practices for all job Total cost of facility time 24 applicants and employees, ensuring that disability Total pay bill 21,388 and all protected characteristics are managed fairly and Percentage of the total pay bill spent of facility time 0.11% appropriately. The Commission is also signed up to the Paid trade union activities Disability Conﬁdent scheme which guarantees interviews Time spent on paid trade union activities 8% for candidates with disabilities who meet the criteria. as a percentage of total paid facility time

We continue to report on the Gender Pay Gap, and action we are taking to reduce it. We routinely report to the Board on workforce diversity. Equality issues are covered and assessed within each of our policies, and as part of our compliance with the Equalities Act 2010.

Our Trade Union Partnership agreement has continued this year, alongside our Trade Union Health and Safety Committee which meets regularly.

50 Parliamentary accountability disclosures Regularity of expenditure Fees and charges – audited Losses and special payments – audited In accordance with Managing Public Money, entities Managing Public Money states that individual losses should provide an analysis of fees and charges income and special payments of more than £300k should where material. be noted separately. See ‘Fees and charges’ on page 27. There were no losses or special payments exceeding £300k during 2020-21. Remote contingent

Gifts – audited liabilities – audited Managing Public Money states any gifts made over Managing Public Money states any material remote the limits proscribed limits should be disclosed. contingent liabilities (that is, those that are disclosed under Parliamentary reporting requirements and not There were no gifts made during 2020-21. under IAS 37) should be reported.

There were no remote contingent liabilities during 2020-21.

Andrew Rhodes Interim Chief Executive and Accounting Officer 6 July 2021

William Moyes Chairman 6 July 2021

51 Accountability report  Parliamentary accountability and audit report

Parliamentary accountability and audit report The report of the Comptroller and Auditor General to the Houses of Parliament Opinion on financial statements I have audited the financial statements of the Gambling under those standards are further described in the Commission for the year ended 31 March 2021 under the Auditor’s responsibilities for the audit of the financial Gambling Act 2005. The financial statements comprise: statements section of my report. Statements of Comprehensive Net Expenditure, Financial Those standards require me and my staff to comply with Position, Cash Flows, Changes in Taxpayers’ Equity; and the Financial Reporting Council’s Revised Ethical Standard the related notes, including the significant accounting 2019. I have also elected to apply the ethical standards policies. These financial statements have been prepared relevant to listed entities. I am independent of the under the accounting policies set out within them. The Gambling Commission in accordance with the ethical financial reporting framework that has been applied in their requirements that are relevant to my audit of the financial preparation is applicable law and International Accounting statements in the UK. My staff and I have fulfilled our Standards as interpreted by HM Treasury’s Government other ethical responsibilities in accordance with these Financial Reporting Manual. I have also audited the requirements. information in the Accountability Report that is described I believe that the audit evidence I have obtained is in that report as having been audited. sufficient and appropriate to provide a basis for my In my opinion, the financial statements: opinion.  give a true and fair view of the state of the Gambling Conclusions relating to going concern Commission’s affairs as at 31 March 2021 and of the In auditing the financial statements, I have concluded that Gambling Commission’s net expenditure for the year the Gambling Commission’s use of the going concern then ended; basis of accounting in the preparation of the financial  have been properly prepared in accordance with the statements is appropriate. Gambling Act 2005 and Secretary of State directions issued thereunder. Based on the work I have performed, I have not identified any material uncertainties relating to events or conditions Opinion on regularity that, individually or collectively, may cast significant doubt In my opinion, in all material respects, the income and on the Gambling Commission's ability to continue as a expenditure recorded in the financial statements have going concern for a period of at least twelve months from been applied to the purposes intended by Parliament when the financial statements are authorised for issue. and the financial transactions recorded in the financial statements conform to the authorities which govern them. My responsibilities and the responsibilities of the

Basis for opinions Commission and the Accounting Officer with respect I conducted my audit in accordance with International to going concern are described in the relevant sections Standards on Auditing (ISAs) (UK), applicable law and of this report. Practice Note 10 ‘Audit of Financial Statements of Public The going concern basis of accounting for Gambling Sector Entities in the United Kingdom’. My responsibilities Commission is adopted in consideration of the

52 requirements set out in HM Treasury’s Government Opinion on other matters Financial Reporting Manual, which require entities to In my opinion, based on the work undertaken in the adopt the going concern basis of accounting in the course of the audit: preparation of the financial statements where it anticipated  the parts of the Accountability Report to be audited that the services which they provide will continue into have been properly prepared in accordance with the future. Secretary of State directions made under the Gambling Act 2005; and Other Information The other information comprises information included  the information given in the Performance and in the annual report, but does not include the parts of Accountability Reports for the financial year for which the financial statements are prepared is the Accountability Report described in that report as consistent with the financial statements. having been audited, the financial statements and my auditor’s report thereon. The Commission and the Matters on which I report by exception Accounting Officer is responsible for the other information. In the light of the knowledge and understanding of the My opinion on the financial statements does not cover Gambling Commission and its environment obtained the other information and except to the extent otherwise in the course of the audit, I have not identified material explicitly stated in my report, I do not express any form misstatements in the Performance and Accountability of assurance conclusion thereon. In connection with my reports. I have nothing to report in respect of the following audit of the financial statements, my responsibility is to matters which I report to you if, in my opinion: read the other information and, in doing so, consider  adequate accounting records have not been kept whether the other information is materially inconsistent or returns adequate for my audit have not been with the financial statements or my knowledge obtained received from branches not visited by my staff; or in the audit or otherwise appears to be materially  the financial statements and the parts of the misstated. If I identify such material inconsistencies Accountability Report to be audited are not in or apparent material misstatements, I am required to agreement with the accounting records and returns; or determine whether this gives rise to a material  certain disclosures of remuneration specified by misstatement in the financial statements themselves. HM Treasury’s Government Financial Reporting If, based on the work I have performed, I conclude that Manual are not made; or there is a material misstatement of this other information,  I have not received all of the information and I am required to report that fact. explanations I require for my audit; or

I have nothing to report in this regard.  the Governance Statement does not reﬂect compliance with HM Treasury’s guidance.

53 Accountability report  Parliamentary accountability and audit report

The report of the Comptroller and Auditor General to the Houses of Parliament continued

Responsibilities of the Commission and they could reasonably be expected to influence the Accounting Officer for the financial statements economic decisions of users taken on the basis of As explained more fully in the Statement of the these financial statements. Commission and Accounting Officer’s responsibilities, I design procedures in line with my responsibilities, the Commission and the Accounting Officer are outlined above, to detect material misstatements in responsible for: respect of non-compliance with laws and regulation,  the preparation of the financial statements in including fraud. accordance with the applicable financial reporting My procedures included the following: framework and for being satisfied that they give a true and fair view;  Inquiring of management, the Gambling Commission’s

 internal controls as the Commission and the head of internal audit and those charged with Accounting Officer determines is necessary to governance, including obtaining and reviewing enable the preparation of ﬁnancial statement to supporting documentation relating to the Gambling be free from material misstatement, whether due Commission’s policies and procedures relating to:

to fraud of error; and  identifying, evaluating and complying with laws

 assessing the Gambling Commission’s ability to and regulations and whether they were aware continue as a going concern, disclosing, as applicable, of any instances of non-compliance;

matters related to going concern and using the going  detecting and responding to the risks of fraud concern basis of accounting unless the Commission and whether they have knowledge of any actual, and the Accounting Officer anticipates that the suspected or alleged fraud; and services provided by the Gambling Commission  the internal controls established to mitigate risks will not continue to be provided in the future. related to fraud or non-compliance with laws and Auditor’s responsibilities for the audit of the regulations including the Gambling Commission’s financial statements controls relating to the Gambling Act 2005 and My responsibility is to audit, certify and report on the Managing Public Money. financial statements in accordance with the Gambling  discussing among the engagement team regarding Act 2005. how and where fraud might occur in the financial

My objectives are to obtain reasonable assurance about statements and any potential indicators of fraud. As part of this discussion, I identified potential for whether the financial statements as a whole are free from fraud in the following areas: revenue recognition material misstatement, whether due to fraud or error, and and posting of unusual journals; to issue a report that includes my opinion. Reasonable  obtaining an understanding of Gambling Commission’s assurance is a high level of assurance but is not a framework of authority as well as other legal and guarantee that an audit conducted in accordance with regulatory frameworks that the Gambling Commission ISAs (UK) will always detect a material misstatement when operates in, focusing on those laws and regulations it exists. Misstatements can arise from fraud or error and that had a direct effect on the financial statements or are considered material if, individually or in the aggregate, that had a fundamental effect on the operations of the

54 Gambling Commission. The key laws and regulations to any indications of fraud or non-compliance with laws I considered in this context included the Gambling Act and regulations throughout the audit. 2005, Managing Public Money as well as employment, A further description of my responsibilities for the audit taxation and pensions legislation; of the financial statements is located on the Financial  assessing the incentives for management to Reporting Council’s website at: manipulate reported income and expenditure; www.frc.org.uk/auditorsresponsibilities  reviewing the Gambling Commission’s accounting This description forms part of my report. policies; and In addition, I am required to obtain evidence sufficient  using analytical procedures to identify any unusual to give reasonable assurance that the income and or unexpected relationships and transactions. expenditure reported in the financial statements have In addition to the above, my procedures to respond been applied to the purposes intended by Parliament to identified risks included the following: and the financial transactions conform to the authorities  reviewing the financial statement disclosures and which govern them. testing to supporting documentation to assess I communicate with those charged with governance compliance with relevant laws and regulations regarding, among other matters, the planned scope discussed above; and timing of the audit and significant audit findings,  enquiring of management, the Audit and Risk including any significant deficiencies in internal control Committee and in-house legal counsel concerning that I identify during my audit. actual and potential litigation and claims;

 reading minutes of meetings of those charged with Report governance and the Commission; I have no observations to make on these ﬁnancial statements.  in addressing the risk of fraud through management override of controls, testing the appropriateness of Gareth Davies journal entries and other adjustments; assessing 12 July 2021 whether the judgements made in making accounting Comptroller and Auditor General estimates are indicative of a potential bias; and evaluating the business rationale of any signiﬁcant National Audit Office transactions that are unusual or outside the normal 157-197 Buckingham Palace Road course of business; and Victoria

 in addressing the risk of fraud in revenue recognition, London assessing controls over invoice raising and new licence SW1W 9SP awards in year.

I also communicated relevant identiﬁed laws and regulations and potential fraud risks to all engagement team members including internal specialists and signiﬁcant component audit teams and remained alert

55 Financial statements

Financial statements

Statement of comprehensive net expenditure for the year ended 31 March 2021

31 March 2021 31 March 2020 Notes £’000s £’000s Income Licence fee income 4b 18,463 19,653 Other income 5 405 251 Total Operating Income 18,868 19,904 Expenditure Staff costs 3a (21,388) (19,491) Depreciation and amortisation 6 & 7 (696) (644) Right-of-use depreciation 16 (942) (823) Other expenditure 3b (15,035) (16,495) Total Operating Expenditure (38,061) (37,453)

Net Operating Expenditure (19,193) (17,549) Finance income 4b 15 65 Finance expense (3) (12) Finance cost on lease liability 3b (102) (114) Interest cost on pensions liability 3a (4) (6) Net expenditure for the year (19,287) (17,616)

Other comprehensive expenditure 31 March 2021 31 March 2020 Notes £’000 £’000 Net loss on pension liability 3a (9) (1) Comprehensive expenditure for the year (19,296) (17,617)

The notes on pages 60 to 77 form part of these accounts. The Commission receives grant-in-aid funding which fully covers the National Lottery expenditure. Grant-in-aid is treated as a ﬁnancing transaction rather than revenue and is taken directly to reserves.

56 Statement of ﬁnancial position as at 31 March 2021

31 March 2021 31 March 2020 Notes £’000s £’000s Non-current assets Property, plant and equipment 6 693 910 Intangible assets 7 553 773 Right-of-use assets 16 3,945 4,887 Total non-current assets 5,191 6,570 Current assets Trade and other receivables 8 918 916 Cash and cash equivalents 9 17,556 16,605 Total current assets 18,474 17,521

Total assets 23,665 24,091 Current liabilities Trade and other payables 10 (14,634) (13,655) Short Term Lease Liabilities 16 (932) (782) Pension liability and provisions 12 (16) (15) Consolidated Fund payables 13 – (278) Total current liabilities (15,582) (14,730)

Total assets less current liabilities 8,083 9,361 Non-current liabilities Deferred Income 11 (628) (794) Long Term Lease Liabilities 16 (3,305) (4,398) Pension liability 12 (199) (203) Total non-current liabilities (4,132) (5,395)

Total assets less total liabilities 3,951 3,966 Taxpayers' equity General fund 3,951 3,966 Total equity 14 3,951 3,966 The notes on pages 60 to 77 form part of these accounts.

Andrew Rhodes William Moyes Interim Chief Executive and Accounting Officer Chairman 6 July 2021 6 July 2021

57 Financial statements

Financial statements

Statement of cash ﬂow for the year ended 31 March 2021

31 March 2021 31 March 2020 Notes £'000s £'000s Cash flows from operating activities Net operating expenditure for the year* (19,196) (17,561) Adjustments for non-cash transactions 6, 7,12 & 16 1,625 1,774 (Increase)/Decrease in trade and other receivables 8 (2) 714 Increase/(Decrease) in trade and other payables 10,11 & 13 534 (9,418) Use of provisions 12 (3) (8) Net cash inflow from operating activities (17,042) (24,499) Cash flows from investing activities Interest received 4b 15 65 Purchase of property, plant and equipment 6 (194) (440) Purchase of intangible assets 7 (65) (299) Net cash outflow from investing activities (244) (674) Cash flows from financing activities Grant-in-aid for capital and revenue expenditure 18,487 17,020 Grant-in-aid advance for revenue expenditure 21 794 – Payment of lease liabilities 16 (1,044) (1,002) Net cash inflow from financing activities 18,237 16,018

Net increase/(decrease) in cash and cash equivalents in the period 9 951 (9,155)

Cash and cash equivalents at 31 March 2020 16,605 Cash and cash equivalents at 31 March 2021 17,556

The notes on pages 60 to 77 form part of these accounts. * The Net expenditure for the year includes Finance expense of £3k (£12k 2019-20) relating to tax on interest receivable.

58 Statement of changes in taxpayers' equity for the year ended 31 March 2021

Income & Expenditure Reserve Notes £'000s Balance at 1 April 2019 4,563 Changes in reserves Comprehensive net expenditure for the year (17,616) Actuarial gain arising on pension scheme (1) Grant-in-aid for revenue expenditure 17,020 Total recognised comprehensive net expenditure for 2019-20 (597)

Balance at 31 March 2020 3,966

Balance at 1 April 2020 3,966 Changes in reserves Grant-in-aid for revenue expenditure 18,487 Grant-in-aid advance for revenue expenditure 21 794 Comprehensive net expenditure for the year (19,287) Actuarial loss arising on pension scheme (9) Total recognised comprehensive net income for 2020-21 (15)

Balance at 31 March 2021 3,951

The notes on pages 60 to 77 form part of these accounts.

59 Financial statements  Notes to the accounts

Notes to the accounts for the 12 months ended 31st March 2021

1: Statement of of each asset is reviewed periodically and updated if expectations differ from previous estimates due to physical accounting policies wear and tear, technical or commercial obsolescence or The policies adopted are in accordance with the legal or other limits on the use of an asset. International Financial Reporting Standards (IFRS), Extension options to the extent it is meaningful and appropriate in the At lease commencement the Commission makes a public sector context, as adopted and interpreted decision as to whether we are reasonably certain to by the 2020/21 Financial Reporting Manual (FReM) be exercising break clauses, extension options. This issued by Her Majesty's Treasury (HMT). judgement impacts the length of the lease term impacting a) Accounting conventions the lease liabilities and right of use assets. This has been These are the accounts for the Gambling Commission reviewed if there is a signiﬁcant event or signiﬁcant change (the Commission) covering the twelve months from of circumstances. 1 April 2020 to 31 March 2021. They have been prepared Depreciation and amortisation in a form directed by the Secretary of State for Digital, Depreciation and amortisation are provided on all Culture, Media, and Sport (DCMS) with the approval non-current assets on a straight-line basis to write of HMT, in accordance with Schedule 4 of the Gambling off the cost or valuation evenly over the asset’s Act 2005 (the Act). A copy of the accounts direction currently anticipated life as shown in the table below. can be obtained from the Commission. Anticipated life of assets The particular policies adopted by the Commission are

described below and have been applied consistently Asset Anticipated life

during the year. No new accounting standards have IT Hardware 4 years

been adopted during the year. IT Software Licences Over the life of the licence

b) Non-current assets IT Developed Software 5 years Non-current asset purchases are capitalised if the Fixtures & Fittings 10 years original purchase price of an item or group of related items is £2,500 or more and the asset or group of assets Furniture 10 years

has a useful life that exceeds one year. Purchased Equipment 7 years software licences are classiﬁed as intangible assets. Telecoms 7 years

Accounting estimates and judgements Motor Vehicles 4 years Critical accounting estimates and judgements Right-of-use Over the life of the lease

Valuation of non-current assets The value of the Commission's property, plant and Depreciation and amortisation are charged in full in the equipment, right of use assets and intangibles are month following acquisition of the asset, with no charge estimated based on the period over which the assets are being made in the month of disposal. No amortisation expected to be available for use. Such estimation is based is charged on software development until the asset is on experience with similar assets. The estimated useful life completed.

60 Property, plant & equipment  the Commission intends to complete the asset Property, plant and equipment is stated at depreciated and sell or use it; historic cost as a proxy for fair value. All of the  the Commission has the ability to sell or use the asset; Commission's assets are short life assets and therefore  the intangible asset will generate probable future depreciated historic cost is not considered to be materially economic or service delivery benefits, for example different from fair value. A review of property, plant and there is a market for it or its output, or where the equipment is undertaken annually to ensure that all items asset is to be used for internal use, the usefulness of the asset can be determined; are still in use and that disposals have been appropriately treated through the year.  there are adequate financial, technical and other resources available to the Commission to complete Property leases assesed for IFRS 16 Right-Of-Use assets the development and sell or use the asset; and, are valued using a cost model which has been used as  the Commission can measure reliably the expenses a proxy for current value as the underlying asset value attributable to the asset during development. of the short lease is unlikely to fluctuate significantly. Internal staff costs that have been directly incurred in the Annual reviews are also undertaken to identify any implementation of capital projects are identified as capital expenditure, provided that they satisfy the conditions impairment of assets in accordance with the International of IAS 38. Research costs have not been capitalised. Accounting Standard (IAS) 36. Any gain or loss arising from the disposal of property, plant and equipment is Software purchases that have not required development prior to completion are identified as additions within the determined as the difference between the disposal category software in the intangible fixed asset note. proceeds and the carrying amount of the asset and is recognised in the Statement of Comprehensive Net In accordance with the FReM, all intangible assets are carried at fair value. Depreciated historical cost is used Expenditure account as other income or other expenditure. as a proxy for fair value, which is considered not to be Intangible assets materially different from fair value. The Commission's intangible assets are recorded in Revaluation accordance with IFRS and compliant with IAS 38. IAS Increases in value are credited to the Revaluation 38 sets out the criteria for recognising and measuring Reserve, unless it is a reversal of a previous impairment. intangible assets and requires disclosures about them. Reversals are credited to the Consolidated Statement An intangible asset is an identifiable non-monetary asset of Comprehensive Net Expenditure to the extent of the without physical substance. Such an asset is identifiable previous impairment and any excess is credited to the when it is separable, or when it arises from contractual Revaluation Reserve, in accordance with IAS 36, the or other legal rights. Impairment of Assets. Under IFRS software development is classified as On disposal of a revalued asset, the balance on the an intangible asset. Expenditure on development is Revaluation Reserve in respect of that asset becomes capitalised only where all of the following can be fully realised and is transferred to the General Fund. demonstrated: Gains and losses on disposals are determined by  the project is technically feasible to the point of comparing the proceeds with the carrying amount completion and will result in an intangible asset and are recognised in the Consolidated Statement for sale or use; of Comprehensive Net Expenditure.

61 Financial statements  Notes to the accounts

Notes to the accounts for the 12 months ended 31st March 2021 continued

c) Pension costs Past and present employees are covered by the For government bodies reporting under the FReM, IFRS provisions of the Principal Civil Service Pension Scheme 16 will be brought into effect on 1 April 2022 and replaces (PCSPS) which is a defined benefit scheme and is IAS 17 (Leases). The Commission elected, with DCMS unfunded and contributory. authority, to early adopt IFRS 16 in 2019-20 (as adapted by the 2020-21 FReM). The Commission recognises the expected cost of providing pensions on a systematic and rational basis In respect of lessees, IFRS 16 removes the distinction over the period during which it benefits from employees’ between operating and finance leases and introduces services by payment to the PCSPS of amounts calculated a single accounting model that requires a lessee to on an accruing basis. recognise ‘right-of-use’ assets and lease liabilities.

Upon the merger between the Commission and the The definition of a lease has been updated under IFRS National Lottery Commission, the Commission inherited 16, there is more emphasis on being able to control of a pension liability for the former Director General of the the use of asset identified in a contract. There are new Office of the National Lottery (OFLOT). This pension is requirements for variable lease payments such as RPI/CPI an unfunded defined benefit scheme which has benefits uplifts; and there is an accounting policy choice allowable by analogy to the PCSPS and is paid directly from the to separate non-lease components. Commission's own funds. In 2001, upon the recipient At inception of a contract, the Commission assesses reaching retirement age, pension payments commenced. whether a contract is, or contains, a lease. A contract is, This was calculated using actuarially assessed or contains a lease if the contract conveys the right to assumptions at 31 March 2021. control the use of an identified asset for a period of time. d) Operating leases This includes assets for which there is no consideration. Following the adoption of IFRS 16 in 2019-20 financial To assess whether a contract conveys the right to control accounts, the Commission has categorised all leases as the use of an identified asset, the Commission assesses finance leases, with the exception of those leases which whether: are exempt either by having less than 12 months to run  The contract involves the use of an identified asset; from 31st March 2021 or are considered low value (less  The Commission has the right to obtain substantially than £5,000). all of the economic benefit from the use of the asset Rentals due under operating leases are charged over throughout the period of use; and the lease term on a straight-line basis, or on the basis  The Commission has the right to direct the use of actual rental payable where this fairly reflects usage. of the asset. The policy is applied to contracts entered into, or e) Finance leases changed, on or after 1 April 2019. IFRS 16 ‘Leases’ was implemented from 1 April 2019; this introduces a single lessee accounting model that requires At inception or on reassessment of a contract that a lessee to recognise assets and liabilities for all leases contains a lease component, the Commission allocates (apart from the exemptions included below). the consideration in the contract to each lease component on the basis of the relative standalone prices.

62 The Commission assesses whether it is reasonably certain Lease liabilities to exercise break options or extension options at the lease The lease liability is initially measured at the present commencement date. The Commission reassesses this if value of the lease payments that are not paid at the there are significant events or changes in circumstances commencement date, discounted using the interest that were anticipated. rate implicit in the lease, or if that cannot be readily determined, the rate provided by HMT. As a lessee Right of use assets The lease payment is measured at amortised cost using The Commission recognises a right of use asset and lease the effective interest method. It is remeasured when there liability at the commencement date. The right of use asset is a change in future lease payments arising from a is initially measured at cost, which comprises the initial change in the index or rate, if there is a change in the amount of the lease liability adjusted for initial direct costs, Commission’s estimates of the amount expected to be prepayments or incentives, and costs related to payable under a residual value guarantee, or if the restoration at the end of a lease. Commission changes its assessment of whether it will The right of use assets are subsequently measured at exercise a purchase, extension or termination option. either fair value or current value in existing use in line Lease payments included in the measurement of the with property, plant and equipment assets. The cost lease liability comprise the following: measurement model in IFRS 16 is used as an appropriate  Fixed payments, including in-substance fixed proxy for current value in existing use or fair value for the payments; majority of leases (consistent with the principles for  Variable lease payments that depend on an index subsequent measurement of property, plant and or a rate, initially measured using the index rate equipment) except for those which meet one of the as at the commencement date; following:  Amounts expected to be payable under a residual  A longer-term lease that has no provisions to update value guarantee; lease payments for market conditions or if there is a  The exercise price under a purchase option that significant period of time between those updates; and; the Commission is reasonably certain to exercise,  The fair value or current value in existing use of the lease payments in an optional renewal period if the underlying asset is likely to fluctuate significantly due Commission is reasonably certain to exercise an to changes in market prices. extension option, and penalties for early termination The right of use assets is depreciated using the straight of a lease unless the Commission is reasonably certain not to terminate early. line method from the commencement date to the earlier When the lease liability is remeasured a corresponding of the end of the useful life of the right of use asset or the adjustment is made to the right of use asset or recorded end of the lease term. The estimated useful lives of the in the SoCNE if the carrying amount of the right of use right of use assets are determined on the same basis asset is zero. of those of property plant and equipment assets. The Commission presents right of use assets that don’t The Commission applies IAS 36 Impairment of Assets meet the definition of investment properties per IAS40 as to determine whether the right of-use asset is impaired right of use assets on the Statement of Financial Position. and to account for any impairment loss identified.

63 Financial statements  Notes to the accounts

Notes to the accounts for the 12 months ended 31st March 2021 continued

The lease liabilities are included within Lease liabilities to which the entity expects to be entitled to in exchange within current and non-current liabilities on the Statement for those goods or services. The Commission have of Financial Position. considered the five-step process and have determined no change to the revenue recognition approach. f) Employee costs Under IAS 19 Employee Benefits legislation, all employee The Commission collects fee income in relation to the Act. business or employment related costs must be recorded In accordance with its Financial & Accounting Policy, the as an expense as soon as the organisation is obligated Commission recognises income in the following way: to pay them. This includes the cost of any untaken leave  Operator licence application fees: as at the year end. The cost of untaken leave has been Income is recognised in full when the operator determined using data from the Commission's electronic licence is issued. leave records.  Operator licence annual fees: Permanent and short term employee costs are presented Income is recognised equally over the duration of the licence. in accordance with IFRS. Permanent and short term employees are identified as follows:  Personal licence fees: 60% of the Application income received is  Permanent employees are those with a permanent recognised when the licence is issued (to reflect (UK) employment contract with the Commission. the application costs)  Short term employees are other employees engaged The remaining 40% is recognised equally over on the objectives of the entity (for example, short term the duration of the licence (i.e. 5 years). contract employees, agency/temporary employees, 35% of the Maintenance renewal income received locally engaged employees overseas and inward is recognised when the licence is issued (to reflect secondments where the entity is paying the whole the renewal costs). or the majority of their costs). g) Value Added Tax The remaining 65% is recognised equally over the duration of the licence (i.e. 5 years). The Commission is not registered for VAT and therefore all costs are shown inclusive of VAT where VAT has i) Financing grant-in-aid been charged. The Commission receives grant-in-aid funding for National Lottery operations. In accordance with the FReM, Grant- h) Licence fee receipts & in-aid is treated as a financing transaction rather than as fee income recognition revenue as it is a contribution from a controlling entity. The Commission adopted IFRS 15 for the first time in 2018-19 financial year. Income is recognised in line with j) Financial instruments IFRS 15 principles. In practice there has been no change The Commission adopted IFRS 9 – Financial Instruments – in recognition from the policy followed under IAS 18. with effect from financial year 2018-19. We have reviewed our financial instruments in respect of classification, IFRS 15 introduces a new five stage model for the measurement and impairment, applying the expected recognition of revenue from contracts with customers. credit losses where applicable. The assets and liabilities The core principle is to recognise revenue so that it which are considered to be financial in nature are set depicts the transfer of promised goods or services to out in note 19. We do not hold any complex financial customers in an amount that reflects the consideration instruments.

64 k) Functional and presentational currency o) Treatment of penalty packages The Commission's functional and presentational currency Where the Commission has issued a penalty in respect is sterling. The very small number of transactions of a regulatory failing or breach, in the majority of cases denominated in a foreign currency have been translated the penalty is paid directly to a benefactor (where a into sterling at the exchange rate ruling on the date of benefactor has been identified) or to a nominated the transaction. Resulting exchange gains and losses responsible gambling charity. Only the direct costs of are recognised in the Commission's surplus or deficit the Commission and a reasonable share of expenditure in the period in which such gains or losses arise. incurred which is directly referable to the investigation or the imposition and enforcement of the penalty, is l) Corporation Tax retained by the Commission. The amounts retained The Commission is registered with HMRC to pay by the Commission are shown within the accounts as Corporation Tax on interest received on cash balances held. other income. m) Segmental reporting During the year the Commission's Board as 'Chief In the event that a fine is issued for a regulatory breach, Operating Decision Maker' has determined that the the Commission will collect the fine and pay it to the Commission operated in three distinct material segments; Consolidated Fund having deducted the costs of its to regulate commercial gambling, to regulate the current investigation under the principle above. National Lottery, and to commission the 4th National Cost recovery or amounts due to be passed over to Lottery. All three segments fall within one main the Consolidated Fund at the year end shown as other geographical segment, Great Britain. The Commission creditors, penalties are not included within the has distinct sources of income for the three segments; Commission's accounts. licence fees for gambling regulation, grant-in-aid for p) Going concern National Lottery regulation, and National Lottery The financial statements have been prepared on a going Commissioning. The segmental reporting format in note concern basis. The recent events in respect of the 2 reflects the Commission's management and internal Covid-19 outbreak may have a financial impact on the reporting structure. Commission's fee income over the coming year. However n) Cash and cash equivalents we expect to remain in a positive cash and reserves The Commission's cash deposits are held with a single position for the coming twelve months, as a statutory commercial bank, and with the Government Banking body created under the Gambling Act 2005 we anticipate Service. continuing to provide a statutory service in the future.

The Commission's deposits are considered to be cash, As such the accounts have been prepared on a going as all deposits with the commercial bank are repayable concern basis. immediately without penalty and without notice. q) Accounting standards that have

Cash equivalents are classed as investments that mature been issued but not yet adopted A number of new standards, amendments to standards in three months or less, and are readily convertible to and interpretations are not yet effective for the 12 months known amounts of cash with insigniﬁcant risk of change ended 31 March 2021 and have not been applied in in value. The Commission does not consider that it holds preparing the accounts. The following are those any cash equivalents.

65 Financial statements  Notes to the accounts

Notes to the accounts for the 12 months ended 31st March 2021 continued

standards, amendments and interpretations that may to be minimal. The standard has not yet been adopted be adopted in subsequent accounting periods: by FReM and therefore early adoption is not permitted.  IFRIC (International Financial Reporting Interpretations  IFRS 17 was published in May 2017 and is expected Committee) 23 was published in June 2017 and to replace the current financial reporting standard for clarifies how to apply the recognition and measurement insurance (IFRS 4) with effect from 1 January 2023. requirements in IAS 12 – Income Taxes. It is not Under the IFRS 17 model, insurance contract liabilities expected to have a significant effect upon the will be calculated as the present value of future Commission's accounts. insurance cash flows with a provision for risk. The effect on the Commission's accounts is anticipated

2: Statement of Operating Costs by operating segment

a) Statement of Comprehensive Net Expenditure by operating segment as at March 2021 31 March 2021 31 March 2020 National National National National Gambling Lottery Lottery Gambling Lottery Lottery operations operations Competition Total operations operations Competition Total £'000s £'000s £'000s £'000s £'000s £'000s £'000s £'000s Expenditure (20,472) (2,756) (14,833) (38,061) (21,196) (2,969) (13,288) (37,453) Income 18,868 – – 18,868 19,904 – – 19,904 Net Operating Expenditure (1,604) (2,756) (14,833) (19,193) (1,292) (2,969) (13,288) (17,549)

Net Operating Expenditure after interest and ﬁnance costs (1,683) (2,760) (14,844) (19,287) (1,348) (2,975) (13,293) (17,616) Other Comprehensive Expenditure Net loss on pension liability – (9) – (9) – (1) – (1) Comprehensive expenditure for the year (1,683) (2,769) (14,844) (19,296) (1,348) (2,976) (13,293) (17,617)

b) Statement of Financial Position by operating segment as at March 2021 31 March 2021 31 March 2020 National National National National Gambling Lottery Lottery Gambling Lottery Lottery operations operations Competition Total operations operations Competition Total £'000s £'000s £'000s £'000s £'000s £'000s £'000s £'000s Non-current assets 4,847 22 322 5,191 5,996 48 526 6,570 Current assets 18,473 1 – 18,474 17,520 1 – 17,521 Total assets 23,320 23 322 23,665 23,516 49 526 24,091 Current liabilities (15,148) (229) (205) (15,582) (14,273) (195) (262) (14,730) Non-current liabilities (3,677) (324) (131) (4,132) (4,850) (218) (327) (5,395) Total liabilities (18,825) (553) (336) (19,714) (19,123) (412) (589) (20,125)

Assets less liabilities 4,495 (530) (14) 3,951 4,393 (363) (63) 3,966

66 3: Staff costs a) Employee costs 2021 2020 £'000s £'000s Employee costs 21,388 19,491 Interest costs on pension scheme liability 4 6 Actuarial loss to pension scheme liability 9 1 Total 21,401 19,498 b) Other expenditure 2021 2020 £'000s £'000s Accommodation 856 887 Professional fees* 11,280 10,834 Travelling and subsistence 2 514 Contingent labour costs 225 822 Other staff costs 102 252 Recruitment, training and development 273 473 Hospitality – 16 Office services 1,659 1,821 External audit fee** 61 61 Internal audit costs 198 174 Amounts payable to Criminal Records Bureau 24 101 Research costs*** 261 331 Other 94 209 Other expenditure 15,035 16,495

Finance cost right-of-use 102 114 Total other expenditure 15,137 16,609

*** Professional fees include consultancy costs totalling £2.0m (2019-20 £1.02m), £1.8m relates to increased costs relating to the National Lottery Competition. *** The external audit fee represents the cost of the audit of the accounts carried out by KPMG LLP on behalf of NAO. No non audit work was undertaken by KPMG LLP, or NAO during the year. The external audit fee for 2020-21 is £61,000 (2019-20 £61,000). *** Research costs includes costs associated with prevalence studies into gambling. This totalled £261,177 in 2020-21 (2019-20 £331,271). This also includes National Lottery research costs totalling £2,525 in 2020-21 (2019-20 £52,939).

Included within other expenditure are payments made by the Commission during the year under operating leases under IAS17. This shows annual lease expenditure under the exemption thresholds within IFRS 16:

2021 2020 £'000s £'000s Land and buildings – – Other 13 13 Total 13 13

The above analysis comprises the following figures from the Statement of Comprehensive Net Expenditure and Statement of Changes in Taxpayers Equity.

67 Financial statements  Notes to the accounts

Notes to the accounts for the 12 months ended 31st March 2021 continued

c) Non-cash items 2021 2020 £'000s £'000s Depreciation of property, plant and equipment 411 385 Amortisation of intangibles 285 259 Depreciation of right-of-use assets 942 823 Total 1,638 1,467

4: Fee receipts a) Gambling Act 2005 fee receipts 2021 2020 £’000s £’000s Operator licence applications Application fees 911 1,217 Annual fees 16,346 17,936 Personal licence applications 381 1,001 Total fee income received 17,638 20,154 Interest on fee income 15 65 Total 17,653 20,219

b) Gambling Act 2005 income recognised Fees payable under the Act are identiﬁed by income stream, and released to the Commission's Statement of Comprehensive Net Expenditure in accordance with the Commission's Financial and Accounting Policy. Recognised fee income is included within the Statement of Comprehensive Net Expenditure as ‘Licence Fee income’.

Gambling Act 2005 fee income recognised in the year is as follows: 2021 2020 £’000s £’000s Operator licence applications Application fees 663 1,023 Annual fees 17,223 17,712 Personal licence applications 577 918 Total fee income 18,463 19,653 Interest on fee income 15 65 Total 18,478 19,718 5: Other income Miscellaneous income collected during the year relates to penalties issued for breach of licence conditions, withdrawn applications, contributions to costs arising from enforcement action.

2021 2020 £’000s £’000s Miscellaneous income 405 251 Total other income 405 251

68 6: Property, plant & equipment Assets under IT Furniture Plant & the course of hardware & fittings machinery construction Total £'000s £'000s £'000s £'000s £'000s Cost/valuation At 1 April 2019 2,181 2,242 185 – 4,608 Reclassification* 18 – – (1 ) 17 Additions 268 45 – 127 440 Disposals 44 – – – 44 At 31 March 2020 2,511 2,287 185 126 5,109 Accumulated depreciation At 1 April 2019 1,533 2,093 183 – 3,809 Reclassification* 5 – – – 5 Provided in year 309 75 1 – 385 At 31 March 2020 1,847 2,168 184 – 4,199

Net book value at 31 March 2020 664 119 1 126 910

Net book value at 31 March 2019 648 149 2 – 799

* During 2019-20, a review of the asset register was carried out resulting in reclassiﬁcations between intangible and tangible assets.

Assets under IT Furniture Plant & the course of hardware & fittings machinery construction Total £'000s £'000s £'000s £'000s £'000s Cost/valuation At 1 April 2020 2,511 2,287 185 126 5,109 Additions 192 2 – – 194 Assets brought into use 126 – – (126) – At 31 March 2021 2,829 2,289 185 – 5,303 Accumulated depreciation At 1 April 2020 1,847 2,168 184 – 4,199 Provided in year 334 77 – – 411 At 31 March 2021 2,181 2,245 184 – 4,610

Net book value at 31 March 2021 648 44 1 – 693

Net book value at 31 March 2020 664 119 1 126 910

69 Financial statements  Notes to the accounts

Notes to the accounts for the 12 months ended 31st March 2021 continued 7: Intangible assets IT Websites Assets under IT Software delivering the course of Software licences services construction Total £'000s £'000s £'000s £'000s £'000s Cost/valuation At 1 April 2019 6,038 279 284 173 6,774 Reclassification* (19) 145 – – 126 Additions 391 3 14 – 408 Assets brought into use – – – (109) (109) At 31 March 2020 6,410 427 298 64 7,199 Accumulated amortisation At 1 April 2019 5,534 279 216 – 6,029 Reclassification* 7 145 – – 138 Provided in year 234 – 25 – 259 At 31 March 2020 5,761 424 241 – 6,426

Net book value at 31 March 2020 649 3 57 64 773

Net book value at 31 March 2019 504 – 68 173 745

* During 2019-20, a review of the asset register was carried out resulting in reclassiﬁcations between intangible and tangible assets.

IT Websites Assets under IT Software delivering the course of Software licences services construction Total £'000s £'000s £'000s £'000s £'000s Cost/valuation At 1 April 2020 6,410 427 298 64 7,199 Additions 60 5 – – 65 Assets brought into use 64 – – (64) – At 31 March 2021 6,534 432 298 – 7,264 Accumulated amortisation At 1 April 2020 5,761 424 241 – 6,426 Provided in year 258 3 24 – 285 At 31 March 2021 6,019 427 265 – 6,711

Net book value at 31 March 2021 515 5 33 – 553

Net book value at 31 March 2020 649 3 57 64 773

70 8: Trade and other receivables 2021 2020 £'000s £'000s Trade receivables 130 98 Deposits and advances 13 52 Accrued income 157 – Prepayments 618 766 Total 918 916 9: Cash and cash equivalents 2021 2020 £'000s £'000s Balance at 1 April 16,605 25,760 Net change in cash and cash equivalent balances 951 (9,155) Balance at 31 March 17,556 16,605 The following balances at 31 March were held at: Government Banking Service 7,260 8,930 Commercial banks and cash in hand 10,296 7,675 Balance at 31 March 17,556 16,605 The majority of the Commission's cash and cash equivalent balances are held at commercial banks or as cash in hand apart from £7,259,730 (£8,929,892 in 2019-20) which is held with the Government Banking Service.

10: Trade and other payables 2021 2020 £'000s £'000s Trade payables 982 1,152 Staff cost payables 1,079 950 Other payables 339 240 Accruals and deferred income** 11,919 11,313 Short term provisions 132 – Provision for Bloomsbury Street premises 183 – Total 14,634 13,655

**The Commission holds total deferred income balances of £10,007,289 (£10,748,490 in 2019/20) included in notes 10 and 11. These relate to: Licence fees received, due to be released to income within one year of £9,379,764 (£9,954,771 in 2019/20). Licence fees received, due to be released to income after one year £627,525 (£793,719 in 2019/20).

11: Amounts due after more than one year 2021 2020 £'000s £'000s Deferred income 628 794 628 794 In accordance with IFRS 15 principles, the Commission's deferred income due after more than one year relates to Personal Licence fees paid that are due to be released to income in years 2021/22 onwards.

71 Financial statements  Notes to the accounts

Notes to the accounts for the 12 months ended 31st March 2021 continued 12: Pension liability provision This provision recognises the payments due in respect of a former chairman of OFLOT.

2020 £'000s At 1 April 2019 226 Interest cost 6 Actuarial loss in the period 1 Pensions paid in the year (15) At 31 March 2020 218

2021 £'000s At 1 April 2020 218 Interest cost 4 Actuarial loss in the period 9 Pensions paid in the year (16) At 31 March 2021 215

The pension liability provision of £214,934 is split between, liability not later than one year (£15,679), and liability greater than one year (£199,255). 13: Consolidated Fund payables The Commission held the following Consolidated Fund payables at 31 March 2021.

2021 2020 £'000s £'000s At 1 April 278 9,873 Arising in the year 2,817 4,544 Settled in the year (3,095) (14,139) At 31 March – 278 There are no payables in relation to ﬁnes recovered due to be surrendered to HMT as at 31 March 2021.

14: Effect of pension liability on statement of ﬁnancial position 2021 2020 Notes £'000s £'000s General fund excluding pension liability 4,166 4,184 Pension liability 12 (215) (218) General Fund 3,951 3,966 15: Capital commitments At 31 March 2021 there were no capital commitments (£0 in 2019/20).

72 16: Right-of-use assets Following the adoption of IFRS 16, the Commission has The finance lease is recognised as an asset and a categorised all leases as finance lease liabilities, with the corresponding lease liability at the net present value exception of those leases which are exempt either by (NPV) of future lease payments. Lease payments are having less than 12 months to run from 31st March 2021 apportioned between the finance charge and the or are considered low value (less than £5,000). reduction of the outstanding liability. a) Right-of-use asset Victoria Square House Bloomsbury Street 2020-21 2019-20 Land and Buildings Land and Buildings Plant & Equipment Total Total £'000s £'000s £'000s £'000s £'000s Cost/valuation At 1 April* 4,357 526 4 4,887 1,729 Additions to right-of-use assets – – – – 3,981 Depreciation charge for the year (736) (204) (2) (942) (823) Balance as at 31 March 3,621 322 2 3,945 4,887 No later than one year 736 204 2 942 942 Later than one year and not later than five years 2,885 118 – 3,003 3,945 Later than five years – – – – – Balance as at 31 March 3,621 322 2 3,945 4,887 b) Lease liability Victoria Square House Bloomsbury Street 2020-21 2019-20 Land and Buildings Land and Buildings Plant & Equipment Total Total £'000s £'000s £'000s £'000s £'000s Leases under IFRS 16 At 1 April (4,586) (589) (4) (5,179) (2,087) Additions to lease liabilities** – – – – (3,981) Interest on lease liabilities @ 1.99%*** (91) (11) – (102) (114) Cash payment**** 778 264 2 1,044 1,002 Balance as at 31 March (3,899) (336) (2) (4,237) (5,180) Total future lease payments under leases are given in the table below for each of the following periods: No later than one year (725) (205) (2) (932) (782) Later than one year and not later than five years (3,174) (131) – (3,305) (4,398) Later than five years – – – – – Balance as at 31 March (3,899) (336) (2) (4,237) (5,180)

**** Right-of-use asset value for Victoria Square House as at 1 April 2020 includes an adjustment of £358k relating to a brought forward deferred rent release provision. The Commission received a rent-free period during 2015/2016, during this time rental charges were accrued and the cost benefit is being released over the life of the lease. **** Lease at Victoria Square House will continue for an additional 5 years to February 2026. **** Interest on lease liabilities – Finance Cost – amounts recognised in SoCNE, a discount rate of 1.99% has been applied in the calculations of interest on lease liabilities. **** Amount recognised in the statement of cash flow – total cash outflow for leases.

73 Financial statements  Notes to the accounts

Notes to the accounts for the 12 months ended 31st March 2021 continued

Victoria Square House: 17: Commitments under Following a successful application to the Government Property Unit, the Commission signed a lease for its operating leases Following the adoption of IFRS 16 in 2019-20 ﬁnancial existing premises in central Birmingham. The lease was accounts, the Commission has categorised all leases signed in May 2015. The lease is for a period of 10 years are on recognised as lease liabilities, with the exception (with a 5 year break clause) and commenced with effect of those leases which are exempt either by having less from February 2016 when the previous lease expired. than 12 months to run from 31st March 2020 or are As at 31 March 2021, the lease at Victoria Square House considered low value (less than £5,000). will continue for an additional 5 years to February 2026. Rentals due under operating leases are charged over Bloomsbury Street: the lease term on a straight-line basis, or on the basis As part of the National Lottery Competition, the of actual rental payable where this fairly reﬂects usage. Commission have entered into a Intra-UK government agreements for premises in Bloomsbury street London. At 31st March 2021 the Commission was committed to The lease is currently unsigned as at 31 March 2021. making the following payments in respect of operating The lease is for a period of 3 years and commenced leases: with effect from 8 November 2019.

at 31 March 2021 at 31 March 2020 Land and Land and buildings Other buildings Other £’000s £’000s £’000s £’000s Obligations under operating leases for the following periods: Not later than one year – 11 – 11 Later than one year and not later than five years – – – – Later than five years – – – – – 11 – 11 18: Related party transactions The Commission is a Non-Departmental Public Body funded through the collection of licence fees from the industry and grant-in-aid for National Lottery operations.

DCMS is regarded as a related party. During the 12 months to 31 March 2020, the Commission has had a small number of material transactions with DCMS, comprising of: Grant-in-aid for revenue expenditure National Lottery operation £2,770,019 Grant-in-aid for revenue expenditure National Lottery competition £15,083,535* Grant-in-aid for revenue expenditure Gambling Commission £873,000

Grant-in-aid advance for revenue expenditure £794,000

* Of the GIA received £249k is due to be repaid and is shown as a liability and not a movement in reserves

During the period none of the Commissioners, members of key management staff or other related parties have undertaken any material transactions with the Commission.

All Commissioners were paid by the Commission, see remuneration report for further details.

74 19: Financial instruments IFRS 7 and IFRS 9 (Financial Instruments: Disclosures) Market rate risk establishes principles for the presentation, recognition Other than ﬁnance leases, the Commission has no and measurement, and disclosure of ﬁnancial instruments borrowings and therefore is not exposed to interest as liabilities or equity. rate risk.

In accordance with IFRS 7 and IFRS 9, the carrying values Credit risk of short term assets and liabilities (at amortised cost) are The Commission does not provide credit arrangements not considered different to fair value. for the payment of licence fees by the industry. All fees must be paid on or before the date prescribed to prevent Because of the way that the Commission is funded the a breach of the licence and the licence being revoked. Commission is not exposed to the degree of financial As the Commission relies on fees receivable from the risk faced by business entities. gambling industry (payable immediately) and departmental Also financial instruments play a more limited role in grant-in-aid for specific projects the Commission has very creating or changing risk than would be typical of listed low exposure to credit risk. companies, to which these standards mainly apply. Liquidity risk The Commission has obtained consent from its Other than finance leases, the Commission has no sponsoring department to place surplus funds on bank borrowings and relies on fees receivable from the deposit. It would also require consent from its sponsoring gambling industry and departmental grant-in-aid for department prior to acquiring financial instruments or its cash requirements, the Commission is exposed to borrowings. minimal liquidity risk.

Currency risk The Commission adopted IFRS 16 Leases during the The Commission is a domestic organisation with the great 2019-20 financial year. The nature of the lease majority of transactions and all assets and liabilities being agreements and the resulting cash flows did not change in the UK and denominated in sterling. The Commission and, as a result, the impact on liquidity is considered has no overseas operations. The Commission therefore to be negligible. is not exposed to currency rate fluctuations.

75 Financial statements  Notes to the accounts

Notes to the accounts for the 12 months ended 31st March 2021 continued

Financial assets & ﬁnancial liabilities Financial assets

Type of financial asset 2020-21 2019-20 £’000s £’000s £’000s Cash and cash equivalents Amortised cost 17,556 16,605 Trade and other receivables Amortised cost 130 98 Deposits Amortised cost – – Loans Amortised cost 13 52 Contract assets Amortised cost – – Subtotal – amortised cost – 17,699 16,755 Equity investments – held through OCI inc. Investment Funds and Shares and Equity type Investments FVOCI – – Investment in subsidiaries FVOCI – – Subtotal – FVOCI Derivative financial instrument assets FVTPL – – FI non Derivatives through PL FVTPL – – Subtotal – FVTPL – – – Total ﬁnancial assets – 17,699 16,755

Financial liabilities

Type of financial asset 2020-21 2019-20 £’000s £’000s £’000s Trade and other payables Amortised cost (1,402) (1,678) Lease liability Amortised cost (4,237) (5,180) Contract liabilities Amortised cost – – Subtotal – amortised cost – (5,639) (6,858) Derivative financial instrument liabilities FVTPL – – Subtotal – FVTPL – – – Total ﬁnancial liabilities – (5,639) (6,858) Total – 12,060 9,897

Definitions under IFRS 9: Financial assets measured at amortised cost Financial assets measured at FVTPL Held in a business model whose objective is to hold (Financial asset at fair value through profit or loss) For all other equity instruments, excluding those elected assets to collect contractual cash flows only (eg a above, all derivatives and any instruments specifically simple debt instrument not classified at fair value). designated to this category using the fair value option Financial assets classified and measured at FVOCI (available on initial recognition as an alternative to (Financial asset at fair value through other comprehensive income) measuring at FVOCI to reduce an accounting mismatch). Held in business model whose objective is achieved by collecting contracts and selling financial assets. This category is mandatory for some debt instruments (ie all except those measured at amortised cost (AC) or FVTPL) and irrevocably elected equity instruments (which can also be measured at FVOCI).

76 20: Contingent liabilities 22: Events after the disclosed under IAS 37 reporting period There are contingent liabilities of £967,238 as at These accounts were authorised for issue on the 31 March 2021 (£275,860, 2019-20). date the Comptroller and Auditor General certified the accounts as shown on the audit certificate. The contingent liabilities figure is a combination of legal costs (£498,950) and voluntary exits (£468,288) which There are no post balance sheet events to report has been calculated under the guidance of IAS 37, since 31 March 2021. based on events existing at the balance sheet date.

21: Grant-in-aid (GIA) advance for revenue expenditure Due to the uncertainty of the Commissions income as a result of the Covid-19 pandemic, DCMS provided additional GIA funding to enable the Commission to maintain its reserves at the minimum level of £3.5m.

This funding is in substance GIA and has been treated in the same way as other GIA receipts from DCMS. In accordance with the FReM, GIA is treated as a ﬁnancing transaction rather than as revenue as it is a contribution from a controlling entity. This GIA of £794k is offsetable from future GIA receipts from DCMS over the course of the coming four years.

It has been agreed that £451k will be offset early in 2021-22. DCMS have advised that of the remaining balance of £343k, 10% will be offset in 2021-22 and 30% for each of the following 3 years.

77 Appendices  Appendix 1  The Executive Group

Appendices

Appendix 1 The Executive Group The Executive Group makes decisions about projects, policy, procedure, issues and cases which cannot be resolved at an operational level as they are novel or contentious, or signiﬁcantly affect the Commission’s ﬁnances or staff.

The scope of the Executive group therefore extends to:

 Strategic leadership of the Gambling Commission

 Collective concentration on strategic issues affecting the Commission

 Scrutiny and challenge of Commission policies and procedures

 Review of business delivery, operational and ﬁnancial performance

78 The Executive Group also agrees items for escalation to the Board of Commissioners, setting the agenda for Board meeting and clearing Board papers.

Sarah Gardner – Deputy Sally Jones – Chief Richard Watson Tim Miller Chief Executive (Joint Operating Officer (Joint Executive Director Executive Director Acting Chief Executive) Acting Chief Executive)

Helen Venn John Tanner Vic Beaumont Marie Perry Executive Director Executive Director Chief People Officer Chief Financial Officer

Alistair Quigley – Chief Paul Hope – Executive Tamsin Morgan Neil McArthur Technology Officer Director (resigned) Chief Communications Chief Executive (resigned) Officer (resigned)

79 Appendices  Appendix 1  The Executive Group

The Executive Group continued

Sarah Gardner Tim Miller Deputy Chief Executive (Joint Acting Chief Executive) Executive Director Sarah joined in 2009 and has held a number of leadership Tim joined the Commission in 2016 after a career roles across the Commission. She spent her earlier career spanning over 15 years in the regulatory and public as a civil servant in various government departments sector. Tim was previously head of policy and covering a wide range of topics including tax, international communications at the Local Government Ombudsman policy, consumer protection, competition, regulation, small and prior to that was head of public affairs at the business and enterprise policy. Sarah is the executive Parliamentary and Health Service Ombudsman. These director responsible for our consumer policy work and the roles followed ten years at the Law Society of England development of our regulatory framework, including the and Wales in a variety of regulatory posts. In his role Licence Conditions and Codes of Practice (LCCP). Sarah at the Commission, Tim is responsible for policy, was appointed joint acting chief executive in March 2021. research and our safer gambling work. Sally Jones Helen Venn Chief Operating Officer (Joint Acting Chief Executive) Executive Director Sally joined the Commission in 2020 as Chief Operating Helen is executive director for licensing and compliance Officer and has 30 years’ experience in senior leadership and with responsibility for regulatory delivery. Helen has roles, latterly in professional services. Earlier in her career, been with the Commission for nearly six years and a Sally spent several years in the public sector holding solicitor for nearly 25 years. Her career included roles at senior roles in both central and local Government. At the the Criminal Cases Review Commission, Serious Fraud Commission, Sally is responsible for corporate services Office, Solicitors Regulation Authority and in private including IT and Digital Services, People Services, Finance practice. and Programme Management, and Governance. Sally John Tanner was appointed joint acting chief executive in March 2021. Executive Director Richard Watson John became the Executive Director and Senior Executive Director Responsible Officer for the 4th National Lottery License Richard is executive director of enforcement and Competition (4NLC) in July 2019. John has overall intelligence with responsibility for regulatory delivery. responsibility for the competition including establishing His teams are responsible for managing the issue of governance, securing funding and engagement with anti-money laundering, dealing with betting integrity, DCMS to ensure the competition is fair, open and robust enforcement of both regulatory and criminal investigations, while maximising innovation, creativity and utilising and the ﬂow of intelligence in and out of the Commission. technological advancements. Before joining the Richard has been with the Commission for eight years, Commission, John held a variety of leadership roles with having previously worked in a variety of law enforcement HM Revenue & Customs, the UK Home Office and the roles for 32 years. National Crime Agency focusing on the delivery of major programmes and transformation projects. Richard left the Commission in May 2021.

80 Vic Beaumont Paul Hope Chief People Officer Executive Director (resigned) Vic joined us in July 2018 building on over 15 years of Paul joined in 2014 to lead work on consumer protection experience across the regulatory and public sectors. and safer gambling. He previously worked for Ofwat, the Vic was previously a consultant working with a range of economic regulator for the water industry, where he held public bodies and prior to that was Director of HR & OD a number of leadership roles. Paul has also previously at the Information Commissioner’s Office. These roles worked as an economist at HM Treasury and the Bank followed a number of senior HR positions in the housing, of England. At the Commission, he is responsible for health and private sectors. Vic is responsible for Human consumers, regulatory policy and strategy. Paul became Resources, Organisational Development and Facilities. executive director for Strategic Planning and Performance in April 2019. Paul left the Commission in December Marie Perry Chief Financial Officer 2020. Marie joined the Commission in January 2020 from the Tamsin Morgan Consumer Council for Water and is responsible for all Chief Communications Officer (resigned) aspects of finance and procurement at the Commission. Before joining the Gambling Commission in 2017, During her career she has held a variety of senior finance Tamsin was Head of Communications for the BBC roles at NHS Trusts within the West Midlands and also across England with responsibility for strategic leadership at police forces in South Yorkshire, Derbyshire and and delivery of all aspects of communication. Prior to that Warwickshire. Marie is also a nonexecutive director and she was Head of Communications for BBC Radio 1 and chair of the audit committee for the Sandwell and West Popular Music at the BBC. As Chief Communications Birmingham Hospitals Trust. Officer she plays a key role in the development and delivery of the Commission’s strategy. Leading a multi- Alistair Quigley Chief Technology Officer disciplined team, Tamsin oversees media relations, Alistair has had a 30-year career in IT and started his public affairs and stakeholder engagement, consumer early career managing a Midlands-based IT training engagement, digital communications, internal centre, before spending six years with National Express, communications and the Chief Executive’s Private Office. becoming their IT Director and overseeing the transport Tamsin left the Commission in January 2021. firm’s rapid online growth. More recently, he was Neil McArthur managing director of IVU Traffic Technologies UK, Chief Executive (resigned) a specialist software developer, before joining the Neil became chief executive of the Gambling Commission Commission 14 years ago. Alistair leads the in February 2018 and stood down from his role in Commission’s IT and digital functions which includes February 2021 after nearly three years in the post. software and digital service development and provision, with an emphasis on information assurance and compliance and information security.

81 Victoria Square House, Victoria Square, Birmingham B2 4BP Tel: 0121 230 6666 Fax: 0121 230 6720 www.gamblingcommission.gov.uk

Victoria Square House, Victoria Square, Birmingham B2 4BP Tel: 0121 230 6666 Fax: 0121 230 6720 www.gamblingcommission.gov.uk